News and Commentary

Jobless Claims Rise After Weeks Of Decline As States Lock Down Again

   DailyWire.com
People wait to receive food at a food distribution site in the Brooklyn borough of New York, the United States, May 14, 2020.
Xinhua/ via Getty Images

Hope for an economic recovery has dwindled after the Labor Department released its weekly jobless claims on Thursday, which totaled 1.4 million – an increase over the previous week’s 1.3 million claims.

As The Washington Examiner (full disclosure: my former employer) reported, this was the “first weekly increase in jobless claims since the end of March, when new applications peaked at 6.9 million, a troubling sign of danger for the economic recovery.”

“The uptick in jobless claims comes as some states have reversed reopening plans for their economies. Coronavirus hotspots had the highest number of claims. Claims for the week ending July 11 were over 65,000 in Florida, more than 33,000 in Georgia, and roughly 20,000 in California,” the outlet continued. “The increase in claims comes as the $600 enhanced unemployment benefit comes to an end.”

House Democrats voted in May to extend the additional $600 in unemployment benefits until January of next year, but Senate Republicans don’t appear to be on board, instead suggesting to the White House that a smaller amount be extended for a shorter period of time. On Wednesday, however, it was announced the short-term extension wouldn’t happen.

“We’re really trying to look at trying to make sure that we have a comprehensive bill that deals with the issues. Any short-term extensions would defy the history of Congress, which would indicate that it would just be met with another short-term extension,” White House Chief of Staff Mark Meadows said, according to The Hill.

The Republican Senate will now tie the additional unemployment benefit to a new coronavirus relief package.

As The Daily Wire previously reported, business owners found it difficult to get employees to come back due to the $600 extra in unemployment benefits, which gave some people more money than if they were to return to work.

In one example, a Washington State spa owner received a forgivable loan from the Small Business Administration through the Paycheck Protection Program. Yet when she told her employees what she thought was good news, many of them became angry.

The employees were angry that they would lose the additional money, even though it was never permanent. Some of them later apologized to the spa owner after realizing that if they didn’t come back to work, there might not be a job to come back to after the extra unemployment funds vanished.

“I couldn’t believe it,” the spa owner, Jamie Black-Lewis, told CNBC. “On what planet am I competing with unemployment?”

Black-Lewis received two loans from the PPP, one for $177,000 and the other for $43,800, to help her two spas in Woodinville and Bothell. Black-Lewis previously had to stop paying all 35 employees and herself due to coronavirus shutdowns forcing “non-essential” businesses like spas and hair salons to close.

As the Examiner noted, average unemployment benefits in the U.S. were about $385 per week, meaning that the additional $600 allowed laid-off workers to make nearly $1,000 a week.

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