Six months: 1 in 4 Iowa workers file jobless claims

While the employment crisis persists, Congress is seemingly deadlocked over the question of extending enhanced unemployment benefits — which expire this week.

The week ending July 25th marked the 26th week of the COVID-19 Recession. In that half year, 420,702 working Iowans (including another 7,441 last week) have filed for unemployment insurance. This is a staggering number. It represents almost one-quarter of the February 2020 labor force. And it is nearly four times the number of claims (107,344) filed by Iowans over the first six months of the Great Recession.

The largest differences between the last recession and this one have come from the eighth week on. The last 19 weeks represent 403,697 of the total increase in this recession, all of those weeks substantially higher than the comparable period in the Great Recession.

While the employment crisis persists, Congress is seemingly deadlocked over the question of extending enhanced unemployment benefits — which expire this week. The HEROES Act, passed by the House in May, would extend the $600/week PUC program through January 31, 2021. The HEALS Act pushed by Senate Republicans would slash that benefit to $200 through the end of September, and then cap the total UI benefit at 70 percent of lost wages. If this passes, weekly benefits for Iowa’s unemployed would drop from an average of $927 per week to $527 per week — a cut of 43 percent. To add insult to injury, the Senate plan also neglects to extend the federal moratorium on evictions.

This is a perilous moment. With new unemployment claims holding steady at more than double the weekly claims of the Great Recession, and economic recovery faltering in the face of surging COVID cases, we need to protect Iowa’s working families from both income insecurity and housing insecurity.

Colin Gordon is senior research consultant for the nonpartisan Iowa Policy Project. He is a professor of history at the University of Iowa.

Data clear: New stimulus needed

Basic protections needed in unemployment insurance, SNAP, energy and other assistance as the COVID-19 virus surges in Iowa and other states in a weak economy.

As the long-awaited next round of federal aid and stimulus remains mired in political infighting, the hardship in Iowa — and around the country — is acute. As a new report from the Center for Budget and Policy Priorities (CBPP) makes clear, households are struggling to pay for the basics now, and that need will only grow if the $600 per week federal “PUC” boost to unemployment insurance benefits expires as scheduled next week.

The receipt of SNAP (food stamps) is up 14 percent in Iowa since February of this year, but the share of Iowans reporting food insecurity continues to grow. According to the CBPP’s analysis of the Census Bureau’s Household Pulse Survey, 1-in-8 (12 percent) Iowa families with children reported (for the last week of June and first week of July) that their household sometimes or often didn’t have enough to eat in the last seven days.

Housing insecurity is also a growing problem. Iowa set up a small fund with CARES Act funds to provide short-term assistance for those unable to make rent or mortgage payments — but disqualified those receiving PUC benefits from even applying. There is about $20 million left in the fund (out of $22 million) but when the PUC expires next week, the demands on this program will skyrocket. According to CBPP, 1 in 6 Iowa tenants are already behind on their rent.

These hardships will be especially stark for Iowa’s Black and Latino workers and their families. Unemployment rates are persistently higher for workers of color. These workers are disproportionately represented among the front-line and manufacturing (especially meat processing) jobs that have posed a higher risk of exposure to the virus. In the absence of meaningful and enforceable workplace protections, the temporary boost to UI benefits provided something of a refuge. As an administrative judge concluded in approving unemployment compensation for a worker who quit because of safety concerns concluded in one recent UI case, “the working conditions at Tyson were unsafe, intolerable and detrimental, and rose to the level where a reasonable person would feel compelled to quit.” But that option evaporates next week.

All of this hardship would be even worse in the absence of the CARES Act provisions for enhanced unemployment insurance, and increased federal support for SNAP, LIHEAP (Low-Income Home Energy Assistance Program), and other social supports. Iowans are suffering with those programs in place, and they will suffer more if social supports are allowed to return to levels previous to COVID-induced shutdowns.

The latest data on initial unemployment claims, released today, show the persistence of Iowa’s economic woes during the pandemic, with nearly 400,000 filing claims in the last 18 weeks.

It is crucial that, with the virus surging in Iowa and other states and the economy projected to remain weak, that our federal representatives move quickly to enact a stimulus package that continues and expands upon these basic protections. We need an extension of expanded unemployment benefits, more opportunities for paid leave, more federal support for child care, SNAP, and LIHEAP, and robust fiscal relief for states and localities. And it is just as crucial that Governor Reynolds and the Iowa Legislature pass along any discretionary state assistance to those in the most need.

Colin Gordon is senior research consultant at the nonpartisan Iowa Policy Project and a history professor at the University of Iowa.