Arizona’s economy has reopened, but unemployment continues to rise according to the latest figures.

Fortunately, the rate of increase has slowed in the past two weeks, according to state and national figures.

An additional 81,000 Arizona residents have filed for unemployment, bringing the total since March 21 to 824,000. The total may include people who applied for benefits more than once, according to the Department of Economic Security.

The state’s still struggling to cope with the backlog of applications — especially for part-time and self-employed workers, who often could not qualify for traditional benefits.

Officially, the unemployment rate in April was 12% in Gila County, 14% in Navajo County and 15% in Apache County, according to the U.S. Bureau of Labor Statistics. Economist say the rate for all three counties and the state may be more than 20%, when you consider discouraged workers and misclassified workers.

The federal COVID-19 stimulus package has boosted maximum benefits in Arizona from $240 a week to $840 per week — at least through the end of July. The state has paid out some $2 billion in benefits since the pandemic began, compared to $3 million weekly before the shutdowns.

DES said the state has a backlog of at least 45,000 claims it has not reviewed. If people qualify, payments will be made retroactive to the date of the original application.

Some local workers say they spent hours on hold making their original applications and have been waiting for more than a month to receive benefits. Navajo County Economic Director Paul Watson said a recent survey of business found most of those part-time and self-employed workers have still not received promised unemployment benefits.

The April job losses have hit some industries much harder than others — including hospitality and food services, with statewide jobs dropping from about 300,000 to about 175,000. Retail trade also took a big hit — going from about 325,000 jobs to about 275,000 jobs. Health care and professional business services also lost about 10% of their jobs annually.

Most other sectors have so far suffered only minor impacts, including construction, government, transportation, manufacturing, real estate, educational services and others. Natural resources and mining were the only sectors to add jobs.

Generally, Arizona has suffered less than many other states. Non-farm employment in Arizona dropped 8% compared to last year, compared to 13% nationally, according to the University of Arizona school of business. Still, the overall unemployment rate in Arizona has risen to at least 13% compared to 4.8% a year ago.

By contrast, the tourist-dependent economy of Nevada now has an unemployment rate of 28%. The official national rate stands at 16%, although experts suggest that’s probably an undercount.

The website Wallet Hub this week posted job losses since the pandemic hit for various cities nationally. Las Vegas ranked as the hardest hit, with a 32% unemployment rate — a sixfold increase from a year ago.

Scottsdale ranked 126th in job losses, with an unemployment rate of 12.3% — a 266% increase from a year ago.

Tucson had a 13.6% rate, a 215% increase.

Tempe had a 12.2% rate, a 243% increase.

Phoenix ranked 150th nationally with 12.7% unemployment, a 210% increase. Chandler ranked 151st and Gilbert ranked 154.

Nationally, 41 million people have lost their jobs — at least temporarily. The share of the population without jobs is probably about 25% — comparable to the Great Depression, according to the Wallet Hub analysis. That’s because the official statistics likely categorize a lot of laid-off workers as “absent from work for other reasons,” suggesting the official rate is perhaps 33% too low.

The website Moneygeek put the real unemployment rate in Arizona at about 21%, based on the figures released by the U.S. Department of Labor. The economy has lost an estimated 304,000 jobs since the start of the pandemic through the end of April. That includes a 38% drop in leisure and hospitality jobs, sectors critical to the tourist dependent economies of Rim Country and the White Mountains. (https://www.moneygeek.com/coronavirus/unemployment-statistics-forecast/us/az#job-losses)

The layoffs came amidst a dramatic drop in consumer spending during April. Overall, personal income rose 11% — thanks to $3 trillion in government spending — all of it tacked onto the roughly $20 trillion national debt.

However, consumer spending fell by 14%, as people stayed home.

As a result, many people stashed their stimulus checks in the bank — prompting the savings rate to rise from 13% to 33%. Economists fear the combination of rising unemployment and plunging consumer spending could cause the gross domestic product to drop 40% in the second quarter.

Economists say the $3 trillion stimulus package cushioned the economic pain of the shutdown — first by boosting unemployment benefits and next by sending each taxpayer about $1,200.

Congress continues to debate another relief package, but unlike the initial, emergency measure the second wave has run afoul of a deep partisan divide.

House Democrats adopted another $3 trillion package, which would extend the enhanced unemployment benefits, provide another round of taxpayer checks and provide billions to bail out state, county and local governments as well as struggling hospitals — among other measures.

Senate Republicans have balked at adopting the package, saying they want to wait to see how distribution of the first flush of stimulus money plays out. Republicans have also said they want a liability shield for businesses that reopen in case workers or customers get infected. Democrats have balked, saying businesses that don’t follow health recommendations should not automatically get lawsuit protection.

Critics have said the first round of stimulus prevented widespread economic suffering, but also represented a windfall for lobbyists and special interests. Moreover, the package didn’t provide enough help for hard-hit sectors like small businesses and didn’t target the worst hit regions, especially reservations.

The initial package even reopened some tax loopholes, like how businesses allocate losses that will cost an estimated $154 billion in revenue — with 80% of the benefit going to people earning more than $1 million. The package also included things like extended funding for “abstinence only” sex education, faster approval of over-the-counter drugs, help for makers of sunscreen and other special interest goodies.

Contact the writer at paleshire@payson.com

Recommended for you

(0) comments

Welcome to the discussion.

Keep it Clean. Avoid obscene, hateful, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful.
Be Nice. No name-calling, racism, sexism or any sort of -ism degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article. Real names only!