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U.S. workers filed 881K claims for jobless benefits last week

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More than 880,000 people filed new applications for unemployment benefits last week, the Labor Department reported on Thursday.

The numbers are not directly comparable to previous weeks because of a change the Labor Department made in how it calculates the claims, which are seasonally adjusted. The number appears lower than the previous week’s 1 million claims, but that reflects a change in the Labor Department’s methodology rather than a strengthening of the U.S. labor market, economists say.

On an unadjusted basis, unemployment claims under state programs rose 0.9 percent from the previous week.

An additional 760,000 laid-off workers filed for jobless aid under the new pandemic unemployment assistance program, created for those not traditionally eligible for unemployment benefits like the self-employed and gig workers. That also marks a rise from the previous week’s 607,806 claims under that program.

Overall claims remain at historic highs. In total, more than 29.2 million workers are receiving unemployment insurance benefits, the Labor Department said, an increase from the prior week’s 27 million.

Why the change? The Labor Department regularly reports seasonally adjusted data, which accounts for expected changes in the labor market, such as when a large number of temporary retail employees get laid off after the holidays.

But economists say that methodology had been causing major distortions to the data during this recession, given how many workers were filing for unemployment due to unexpected coronavirus shutdowns. Experts welcome the change, which they say should make the numbers more accurate in the future, but they warn against trying to compare this week’s seasonally adjusted data to weeks prior.

Regardless of the change in calculations, non-seasonally adjusted data shows overall claims rose last week to 833,352 from 825,761 the week before.

What’s next: The Labor Department will report jobs numbers for the month of August on Friday. The July report showed an overall unemployment rate of 10.2 percent, and while most economists expect that number to fall slightly in August, many expect the pace of job growth will slow down.

This article originally appeared at Politico on August 24, 2020. Reprinted with permission.

About the Author: Megan Cassella is a trade reporter for POLITICO Pro. Before joining the trade team in June 2016, Megan worked for Reuters based out of Washington, covering the economy, domestic politics and the 2016 presidential campaign. It was in that role that she first began covering trade, including Donald Trump’s rise as the populist candidate vowing to renegotiate NAFTA and Hillary Clinton’s careful sidestep of the Trans-Pacific Partnership.

A D.C.-area native, Megan headed south for a few years to earn her bachelor’s degree in business journalism and international politics at the University of North Carolina at Chapel Hill. Now settled back inside the Beltway, Megan’s on the hunt for the city’s best Carolina BBQ — and still rooting for the Heels.


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A gap in federal unemployment benefits is now unavoidable. Here’s why.

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State offices will need weeks to reprogram their systems to account for an extension of the $600 weekly federal payments that expire on Saturday.

Tens of millions of laid-off American workers will go weeks without federal jobless aid — because Congress hasn’t renewed the benefits in time for overwhelmed state unemployment systems to adjust their computers.

State offices will need weeks to reprogram their systems to account for an extension of the $600 weekly federal payments that expire on Saturday — or any changes that Congress makes to the benefit amount or eligibility rules. That comes on top of hardships faced by workers in states like Washington and Nevada, who are already waiting months to get their first payments in the middle of the coronavirus pandemic because their unemployment offices can’t handle the historic flood of claims.

In some states with particularly antiquated systems, it’s already too late to prevent a lapse, even though the federal benefits haven’t officially expired, according to people familiar with how the systems work.

“In some states, it could take quite a bit of time, and it could cause severe delays,” said Arindrajit Dube, a professor of economics at UMass Amherst. “This is the kind of thing you don’t try to change in the middle of a pandemic.”

A gap in the federal program could be devastating for laid-off workers, many of whom are on the verge of eviction and are already behind on their bills. The $600 federal check comes on top of workers’ normal benefit payments which average around $340. The weekly benefit amount varies by state, and is as low as $235 per week in Mississippi.

“I know my clients are really fearful that they’re going to have a deluge use of bills that are going to become due very quickly, and that $600 supplement was really critical to ensuring that they could meet those bills,” said Tori Dempsey of Legal Services of Eastern Missouri, which offers free legal services to lowincome Americans. “Without it, and without any prospect really returning to any sort of secure employment, it’s really unnerving for a lot of them.”

Dempsey said that while some of her clients have been called back to work in recent weeks, their shifts have been reduced to one or two days a week.

“The work just isn’t there for them,” she said.

It’s unlikely Congress will act before Saturday, but even if they do, states have already prepared their systems to cut off the benefits. Republicans want to cut the amount or change how benefits are calculated to prevent workers from making more money on unemployment than they did at their jobs. Democrats are insisting on maintaining the benefit as-is.

The GOP’s next relief proposal is expected to include a temporary flat payment for unemployment insurance for two months, but the final details have not yet been released. President Donald Trump this week said other changes could include capping benefits at 70 percent of a worker’s prior wages.

Any changes could create an accounting disaster for the state systems, which are still struggling to keep up as the number of new workers applying for unemployment benefits each week remains at nearly two times the peak seen during the Great Recession.

More than one million new unemployment applications have poured into state agencies each week for 17 straight weeks, piling onto state backlogs. Across the country about 10 to 15 percent of applications are still waiting to be processed, said Andrew Stettner, a fellow at the Century Foundation.

Hundreds of laid-off workers from Alabama to Oklahoma made headlines in recent weeks as they resorted to camping out in front of unemployment offices, demanding payment.

In Nevada, some workers have been waiting on their unemployment checks for months.

Rhea Gertken, an attorney with Nevada Legal Services, said her clients call the unemployment hotline first thing in the morning, and within minutes, the number of claims that can be processed that day has been reached.

“Say someone calls in at eight o’clock in the morning. Almost immediately, what they’ll get is a recording that says the queue is full for the day, call back later,” she said.

There also are problems with the pandemic unemployment assistance program — a payment created by Congress to send jobless aid to workers ineligible for traditional unemployment benefits, such as gig workers.

Nevada was the last state in the nation to set up its PUA program and Gertken said there’s also been confusion over whether workers should file for unemployment or through the pandemic unemployment assistance program, leading to even more delays.

This week a Nevada judge ruled that the state unemployment office must start paying benefits to some out-of-work gig and independent workers who qualified but haven’t received payments.

The state’s Department of Employment, Training and Rehabilitation, the agency that administers unemployment, didn’t respond to a request for comment.

In Washington state, laid-off workers have been waiting an average of three months to finally receive their benefits, Behnaz Mansouri, an attorney at Unemployment Law Project in Washington state, told POLITICO.

Once workers finally receive their benefits they’re “beyond grateful” and “relieved,” Mansouri said, “However, at this point, they may have already lost their home, their car may have already been repossessed. A lump sum payment coming in doesn’t necessarily resolve recurring expenses that need to be paid in a timely fashion.”

Washington state is still so overwhelmed with new unemployment claims that it has resorted to completely shutting off its phone system except to those who need accommodations for disabilities or because they don’t have internet access.

A spokesperson for Washington’s Employment Security Department said the agency instead focused the bulk of its agents on “making outbound calls to claimants.” ESD said that it began accepting inbound calls again earlier this week.

In Texas, it can still be difficult to just file a claim, said Karen Miller, executive director of the Texas Legal Services Center. Just this week, one of her clients called from 1 p.m. to 7 p.m., every thirty minutes. That person was never able to get through, she said.

Miller also said many of the low-income workers she advises don’t have access to a computer, and have trouble applying through their phones. Before, she’d send the workers to public libraries, but they are now closed due to the coronavirus.

The timing of the lapse in the $600 federal payment couldn’t be worse, she said, as it coincides with the moratoriums on eviction expiring.

“That’s the kicker. Eventually, in Texas, tenants have to be able to pay their rent and so if there’s too much of a delay in that benefit being there, they’re really going to suffer,” she said.

This blog originally appeared at Politico on July 23, 2020. Reprinted with permission.

About the Author: Katherine Landergan covers the state budget, tax policy and labor issues for POLITICO New Jersey.

About the Author: Rebecca Rainey is an employment and immigration reporter with POLITICO Pro and the author of the Morning Shift newsletter.


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Unions warn small business rescue changes will weaken paycheck protection

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Mnuchin touted the program during a congressional hearing as having kept “tens of millions of employees connected to their jobs.” 

Labor groups are warning that newly enacted changes to a popular small business lending program will make the $670 billion relief effort less about protecting workers’ paychecks than protecting businesses.

The bipartisan bill signed into law by President Donald Trump lowered to 60 percent the amount that participants in the program must spend on payroll to qualify for full loan forgiveness from 75 percent — a change that could shift billions of dollars away from workers’ pay. The new rules also give businesses until the end of the year to spend the money, when previously, they had to use up the funds in eight weeks.

The so-called Paycheck Protection Program, created as part of the record $2 trillion coronavirus relief package that Congress passed in March, was aimed at giving businesses an incentive to keep paying their workers during the pandemic by turning the loans into grants if they retained most of their staff.

Now, unions say, businesses have more of an incentive to use the money for non-payroll expenses like rent.

“This change represents a huge loophole in legislation that was meant to help workers keep their paychecks coming during the economic fallout from the pandemic,” United Steelworkers Legislative Director Roy Houseman told POLITICO. “Rather than keeping the focus on maintaining payroll, however, the new threshold for loan forgiveness seems as though it was developed more with an eye toward putting money into business owners’ pockets.”

Treasury Secretary Steven Mnuchin touted the program during a congressional hearing Wednesday as having kept “tens of millions of employees connected to their jobs” and said it has saved 50 million jobs during the pandemic.

Many economists have also suggested that the unexpected job growth seen in the May unemployment report could be attributed to the program. The Labor Department reported last Friday that 2.5 million jobs were added to the economy during the month, upending predictions that payrolls would fall by 7 million.

While the number of workers who were rehired last month won’t be available until the Labor Department releases its monthly Job Openings and Labor Turnover Survey on July 7, economic indicators suggest that a long recovery is still ahead.

Labor groups and some observers fear that the rule changes to the Paycheck Protection Program will lead to less rehiring and an increase in layoffs, potentially thwarting early signs of a recovery in the labor market.

“Changing PPP gives businesses more time to delay rehiring workers, resulting in fewer paychecks for workers,” according to Aaron Klein, a fellow at the Brookings Institution. He says the new law shifts $76.5 billion originally allocated for businesses to pay their employees during the pandemic to other costs, like overhead, and in turn, is “reducing the share that goes to workers.”

Klein said the rule changes provide “businesses the ability to use government grants to pay their creditors, not protecting the paychecks of their employees.”

Damon Silvers, director of policy and special counsel for the AFL-CIO, agreed. He said he’s concerned that the changes “are going to lead to employers pocketing the money and not hiring, and not protecting anybody’s paycheck.”

Business groups said the changes in the lending program were needed because the economic effects of the pandemic have lasted longer than Congress had expected, and the requirements for loan forgiveness were too burdensome. States have also instructed certain businesses, such as those in the restaurant and travel industries, to reopen in limited capacities, which businesses say prevent them from bringing back their full staff.

“Congress had to act quickly to provide flexibility to account for different business structures and operating expenses to make the program work,” Rep. Chip Roy (R-Texas), who co-sponsored the legislation, said in a statement after the bill passed.

Rachel Greszler, senior policy analyst at the Heritage Foundation, disagrees that the changes to the program will lead to layoffs.

“Businesses need a little more flexibility,” said Greszler. “A lot of those businesses who were forced to shut down had to rehire and retain employees, or secure new inventory, or establish vendor relationships, or settle balances. There are a lot more costs involved with starting up than if this had been a very short shutdown.”

The changes to the payroll requirements of the program were originally proposed to be much broader until a pushback from organized labor. The bill by Roy and Rep. Dean Phillips (D-Minn.) would have eliminated the payroll spending requirement altogether, but that was scaled back after more than a dozen labor leaders warned that it would create “a disincentive for employers to retain or rehire workers.”

Neither Phillips nor Roy responded to a request for comment on this article.

While unions were able to convince Democrats to move the payroll spending threshold down to just 60 percent, many are still concerned the rule changes undermine the program’s goal of keeping workers.

The Small Business Administration and the Treasury on Monday said businesses would still qualify for partial loan forgiveness under the PPP, even if they fell short of the 60 percent requirement.

“Thank goodness the House didn’t pass its original bill which would have completely eliminated the paycheck protection part of the PPP,” said D. Taylor, president of UNITE HERE, which represents hotel, gaming, food service and other workers. “The fundamental problem is that the big corporations and private equity firms that own hotels are desperate for a government handout so they can postpone the day of reckoning with their lenders, but the last thing they want to do is provide laid-off workers with paychecks or health benefits.”

Mnuchin and SBA Administrator Jovita Carranza faced questions from the Senate Small Business Committee Wednesday on the implementation of the program, but not a single senator from either party raised concerns about layoffs.

This blog originally appeared at Politico on June 12, 2020. Reprinted with permission.

About the Author: Rebecca Rainey is an employment and immigration reporter with POLITICO Pro and the author of the Morning Shift newsletter. Prior to joining POLITICO in August 2018, Rainey covered the Occupational Safety and Health administration and regulatory reform on Capitol Hill. Her work has been published by The Washington Post and the Associated Press, among other outlets.


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Field Museum Workers Say It’s Time for the CEO to Start Making Sacrifices, Too

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Facing devasting pay cuts and layoffs amid the Covid-19 crisis, workers at Chicago’s Field Museum are organizing to demand greater transparency and equitable sacrifice from upper management.

“We fear these cuts will disproportionately impact staff of color and those already paid the least,” Field Museum workers explain in a petition that has now garnered over 1,700 signatures. “We are proud to call the Field home, and are prepared to make sacrifices to preserve it for generations to come. We are asking leadership to do the same.”

Best known for being the home of SUE, the most intact T. rex skeleton in the world, the Field is the nation’s third largest natural history museum after the Smithsonian and New York’s American Museum of Natural History. As of 2019, the museum had an endowment of approximately $440 million, up from $299 million in 2012.

The museum has been shuttered since mid-March due to the pandemic, and it remains unclear when it will be able to reopen to the public. Though the Field secured a loan from the federal Paycheck Protection Program and 70% of its revenue comes from sources other than ticket sales, at a May 19 virtual town hall with employees, CEO Richard Lariviere announced an impending 10% pay cut as well as an unspecified number of layoffs.

“At the town hall, we had a lot of staff proposing alternatives and various cost-cutting ideas like rotating furloughs, graduated pay reductions, and reducing hours, and asking if those had been explored,” says Anna Villanyi, an educator who has worked at the museum for two years. “But those ideas were dismissed without transparency about to what degree leadership had already explored them.”

Lariviere’s total compensation in 2018—the most recent year with available data—was $796,000. While the presidents of the Boston Museum of Science and American Museum of Natural History have respectively taken a 50% and 25%pay cut in light of the crisis, Lariviere reportedly dismissed the idea of reducing his own compensation as “a meaningless gesture.”

“A lot of museums are experiencing hardship due to this time, and we can see the different ways that is being addressed,” Villanyi tells In These Times. “We have such a large and seemingly financially stable institution that’s choosing not to make equitable moves like graduated pay cuts that other museums are doing.”

The Field Museum’s nearly 400 employees include scientists, collection managers, educators, technicians, guest services workers, maintenance workers and security guards. Many, like Villanyi, have been working from home during the pandemic, but others, like those who manage the upkeep of the museum’s exhibits, are not able to work from home.

Staff who can work remotely have been donating their vacation hours to their coworkers who don’t have the option of working from home, ensuring they continue receiving income. “It has been a really helpful act of sacrifice,” Villanyi says. “I believe it’s been over $200,000 worth of vacation hours that have been donated into that pool.”

In addition to aiding one another through the crisis, Field Museum employees have also been helping the public by sewing face masks and repurposing 3-D printers to make face shields for frontline workers.

The museum workers are specifically calling for a moratorium on pay cuts and layoffs until they can have a greater voice in cost-cutting measures, particularly by having a staff representative present at all future budget meetings.

“I’m hopeful that the increased awareness through our petition puts pressure on accountability for those things to happen,” Villanyi says.

Their organizing effort is being assisted by the Emergency Workplace Organizing Committee (EWOC), a joint project of the United Electrical, Radio and Machine Workers of America (UE) and the Democratic Socialists of America (DSA).

EWOC was launched shortly after the pandemic hit the United States to give non-union workers the resources needed to organize their own workplaces around coronavirus-related demands like hazard pay, sick leave and provision of personal protective equipment.

UE International Representative Mark Meinster says that over 1,000 workers from a range of industries including fast food, manufacturing, meatpacking, retail and higher education have received advice and assistance through EWOC on how to take workplace action around Covid-19 related issues.

With help from EWOC, workers around the country have already won several victories, including improved health and safety measures for grocery workers in Texas and Pennsylvania, and hazard pay for 250 Taco Bell workers in Michigan.

Meinster says that most of the work of EWOC is done through volunteers including DSA members, former Bernie Sanders campaign staff and UE activists.

“We’re building on models developed around the Bernie Sanders campaign of doing distributed organizing—where you’ve got a large group of motivated volunteers—and apply that model to workplace organizing,” Meinster explains. “That’s one of the keys to revitalizing a fighting labor movement. We’ve got to figure out how to go beyond mere staff resources and engage lots of motivated people out there.”

Meinster says the Field Museum organizing is a perfect example of workers organically coming together and reaching out to EWOC for assistance. “Like all museum workers, they’re facing some real difficult fights,” he says. “But here we’re seeing workers start to stand up and do something about it.”

This blog originally appeared at In These Times on June 12, 2020. Reprinted with permission.

About the Author: Jeff Schuhrke is a Working In These Times contributor based in Chicago. He has a Master’s in Labor Studies from UMass Amherst and is currently pursuing a Ph.D. in labor history at the University of Illinois at Chicago. He was a summer 2013 editorial intern at In These Times. Follow him on Twitter: @JeffSchuhrke.


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California Authorities Take Steps to Protect Workers’ Health and Rehiring Post-Quarantine

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State and local governments in California have recently signed into law several measures aimed at protecting workers. At the state level, Gov. Gavin Newsom signed an executive order offering additional paid sick leave to food sector workers. At the local level, both the County and City of Los Angeles have now adopted worker retention and right of recall ordinances protecting the jobs of certain service sector workers. While the potential harm to workers resulting from COVID-19 remains great, these measures should provide some comfort to vulnerable workers at a time of financial insecurity. 

Food workers entitled to additional paid sick leave for reasons related to COVID-19

The statewide measure pertaining to food workers was signed into effect by Gov. Newsom on April 16, 2020. Executive Order N-51-20 points out that food service workers are far less likely to stay home from work when they’re sick if they do not have available paid sick leave. If workers feel they have no choice but to work while sick, there is a greater risk that the infection will spread to all coworkers.

The order addresses these concerns by mandating that employers of food service workers must offer supplemental paid sick leave related to COVID-19 to food service workers. Workers become eligible for this leave when: the worker has been ordered to quarantine or isolate by a federal, state, or local order; the worker is told by a healthcare worker to self-quarantine or self-isolate; or, the worker has been barred from working by their employer based on concerns of transmission of COVID-19. The amount of paid sick leave to which workers are entitled will vary based on the number of hours the employee worked. Workers considered to be “full-time” employees or who were scheduled to work an average of 40 hours per week for the two weeks prior to taking COVID-19-related leave will be entitled to 80 hours of COVID-19 supplemental sick leave. For those working fewer hours per week, the worker will be entitled to take the number of hours of paid leave across two weeks as they would have normally been scheduled to work in that time.

Los Angeles County workers now have a right to rehire and to be retained by new owners

Many laid-off workers fear that, due to the struggling economy, their positions may be filled by new and inexpensive workers rather than the experienced, possibly older, workers who held the position previously. After similar ordinances were signed into effect by City of Los Angeles Mayor Eric Garcetti, the County of Los Angeles has now enacted two ordinances designed to assure laid-off workers in the service industry that they have a right to be rehired when businesses reopen. The City’s orders offer protections to those working at airports; as janitorial, maintenance, or security workers at commercial properties; and at large event centers, hotels, and hotel restaurants. The City’s orders go into effect on June 14, 2020. The County’s orders cover only those who work at commercial properties and hotels, and go into effect on May 12, 2020. Both measures offer workers a right to pursue legal action if they believe their rights have been violated under these ordinances.

The City’s Worker Retention ordinance and the County’s Right of Retention ordinance each mandate that, upon the sale of a business to a new owner, any laid-off employees of that business have a right to be kept on as an employee under the new ownership. The former owner must provide a preferential hiring list of the business’ employees to the new owner. The new owner must hire from that list for six months after the business is again open to the public. In order to be eligible for inclusion on this list, the worker must have worked for the business for at least six months, must have been primarily employed by that business, who is directly employed by or works for someone who has contracted with the former owner, and who worked for the former owner after March 4, 2020 and before the business was sold. These ordinances do not include managerial, supervisory, or confidential employees. Workers rehired by a new owner must be retained for at least 90 days unless the employer can show cause for firing the worker.

The City and County ordinances related to the Right of Recall state that workers laid off on or after March 4, 2020 must be prioritized when businesses begin to rehire workers. The worker must have performed at least two hours of work for that employer each week to be eligible, and have worked for the employer for at least six months prior to layoff. Workers are entitled to an offer for open positions with their former employer if they held the same position previously, or if they could become qualified for the position after completing the same amount of training that a new worker would need. If two workers are eligible for the same position, employers must offer the more senior employee first right of refusal.

About the Author: Kurt R. Mattson is the President of Union Legal Research. He has spent more than 30 years in the legal services industry as a research attorney, writer, editor, and marketer. 


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Why temporary layoffs may become permanent

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Forty-two percent, or 11.6 million, of all jobs lost through April 25 due to Covid-19 will become permanent, according to the University of Chicago.

The White House is downplaying the bulk of coronavirus-related layoffs as temporary. But as the worsening recession forces companies to downsize or shut their doors, economists warn that many of these departures will turn permanent.

The unemployment rate for May is expected to hit about 20 percent, coming on top of April’s 14.7 percent. Those statistics — likely underestimates because workers must be “actively looking” for jobs to be counted — would be the highest since the Great Depression.

But President Donald Trump’s advisers have found a different number to seize on: a Federal Reserve estimate, released earlier this month, that 91 percent of people who lost their jobs or were furloughed reported that they expect to return to the same employer eventually. This statistic, the administration officials say, is part of the reason the U.S. should reopen its economy.

“Besides the stock market, there are little glimmers,” Trump’s economic adviser, Larry Kudlow, said last week. “I don’t want to downplay the heartbreak because the numbers are not good for this quarter — bad, bad pandemic contraction — but there are little glimmers. A lot of the unemployed are temporary.”

But economists say shifting demands and the sheer breadth of the business closures mean that many of the lost jobs will never return — and to lean on the statistic as a sign of economic well-being is politically risky.

“That’s a high number, and that’s good,” said the Economic Policy Institute’s Heidi Shierholz, former chief economist at the U.S. Department of Labor, of the workers’ optimism about returning to their jobs. “But I think we absolutely have to think of that as an upper-bound on how many will be called back.”

“And what we don’t know is how much lower than that … will it ultimately be. The concern is that it’s going to be a lot lower.”

Forty-two percent, or 11.6 million, of all jobs lost through April 25 due to Covid-19 will become permanent, according to research from the University of Chicago’s Becker Friedman Institute. The study places these in three buckets: jobs lost to coronavirus-induced demand shifts, jobs at firms that don’t survive the pandemic and jobs lost due to post-pandemic concerns, such as social distancing.

“I understand that the administration and other folks are optimistic,” the conservative Heritage Foundation’s Paul Winfree, a former Trump aide, said of the temporary layoff numbers. But “I don’t think I can get behind those estimates.”

“We’re going to be dealing with this unemployment problem for quite some time,” Winfree said. “And ultimately, it’s going to plague the economy for months, if not years.”

Businesses in some of the hardest-hit industries have already announced thousands of closures. As of April, about 3 percent of restaurants in the country, once temporarily shuttered, have permanently closed, according to the National Restaurant Association. And manufacturing giants like Caterpillar, Polaris and Goodyear Tire and Rubber Co. are shutting down their once-furloughed factories for good, The Wall Street Journal reports.

“You probably had a lot of businesses in absolute good faith say ‘we’re going to call you back’ totally thinking they were going to, but will never do it,” Shierholz said. “Many may go out of business. And two, it’s very probable that in many cases [when they do reopen] they won’t need everyone.”

Even if businesses make it through the pandemic, continued social distancing and other altered consumer behavior mean that many of them are unlikely to be able to rehire their temporarily laid-off or furloughed workers, economists say.

“If it’s the case that for the next two, three years, far fewer people are going to go out and eat at restaurants, if cinemas and movie theaters are going to have to have semi-permanent social distancing reducing their capacity, then a lot of these businesses will become nonviable and these jobs will be permanently lost,” said Ryan Bourne, an economist with the libertarian Cato Institute.

By touting the majority of layoffs as impermanent, Bourne said, the White House is creating a dangerous precedent given the large degree of uncertainty.

“There’s a political danger to implying that things will just go back to normal, which is that you create the expectation that you’re willing to do what it takes to ensure that happens,” Bourne said. “If I was somebody in the Trump administration, I would not be wanting to create the expectation that 90 percent of existing work relationships … were highly likely to return because I think there’s still a huge degree of uncertainty as to whether that will happen.”

This blog originally appeared at Politico on May 28, 2020. Reprinted with permission.

About the Author: Eleanor Mueller is a legislative reporter for POLITICO Pro, covering policy passing through Congress. She also authors Day Ahead, POLITICO Pro’s daily newsletter rounding up Capitol Hill goings-on.


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Labor Department reports 36.5 million unemployment claims over 2 months

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Thursday’s report brought the eight-week total of coronavirus-induced layoffs to 36.5 million.

Workers filed nearly 3 million new unemployment claims last week, the Labor Department reported Thursday, signaling that a wave of coronavirus-induced layoffs is continuing as the country struggles to reopen for business.

The latest number, which covers the week ending May 9, pushed the two-month tally of unemployment claims to 36.5 million, reflecting a jobless rate that the Bureau of Labor Statistics acknowledged last week is the worst since the Great Depression of the 1930s.

The figure is “another sickening punch to the gut,” Mark Hamrick, senior economic analyst for Bankrate, said in a statement. “And, we need to be braced for more incoming body blows with respect to economic data,” he said.

As high as the official unemployment rate is — BLS said it reached 14.7 percent in April — that likely understates the damage, because large numbers of people misclassified themselves as employed but absent from work, artificially suppressing the jobless rate by about five percentage points.

Unemployment claims by week

“We’re going to see high levels of unemployment for a long time, meaning nine to 18 months,” predicted Tom Gimbel, founder & CEO of LaSalle Network, a national staffing and recruiting firm. “The whole labor model is going to change.”

As most states begin allowing non-essential businesses to reopen their doors, Gimbel said he expects many companies to favor temporary over permanent hiring.

“We’ll see an increase in temporary staffing, because companies are going to be concerned about a resurgence,” Gimbel said. “People don’t want to commit to full-time staff.”

Workers who are called back face a choice between potentially risking their health or losing unemployment benefits. On Monday, DOL “strongly encouraged” state unemployment agencies to find out from employers whether benefit recipients refuse to return to work, as federal guidelines dictate that those workers will no longer be eligible.

The data released by DOL Thursday also indicated that self-employed workers who were made eligible for jobless benefits under a new temporary program, Pandemic Unemployment Assistance, have finally begun to tap into the relief.

In the week ending April 25, 3.4 million Americans were receiving benefits from the program, up from fewer than 1 million the week prior.

In Washington, lawmakers have been unable to agree on next steps to address the economic pain caused by the virus.

House Speaker Nancy Pelosi has scheduled a vote Friday on a new $3 trillion relief package that would include an extension through January of the $600 sweetener to weekly unemployment checks, which is set to expire at the end of July, and another round of direct payments. President Donald Trump and Senate Republicans oppose the plan, and say they prefer to assess the effects of the $2 trillion CARES Act.

But Federal Reserve Chair Jerome Powell said Wednesday that further congressional stimulus would be worth the price.

“The record shows that deeper and longer recessions can leave behind lasting damage to the productive capacity of the economy,” Powell said at a virtual event hosted by the Peterson Institute for International Economics. “Additional fiscal support could be costly but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery.”

The Fed chief said the central bank will release a survey on Thursday showing that nearly 40 percent of people in households making less than $40,000 a year had lost a job in March.

Over the short term, financial losses are already devastating. About half of Americans say they’ve lost income and savings due to the effects of the coronavirus, a National Bureau of Economic Research survey found. On average, those Americans said they’ve lost $5,293 in income and $33,482 in wealth.

This blog originally appeared at Politico on May 14, 2020. Reprinted with permission.

About the Author: Rebecca Rainey is an employment and immigration reporter with POLITICO Pro and the author of the Morning Shift newsletter. Prior to joining POLITICO in August 2018, Rainey covered the Occupational Safety and Health administration and regulatory reform on Capitol Hill. Her work has been published by The Washington Post and the Associated Press, among other outlets.


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Labor Is Pioneering a New Kind of Relief Effort in the Twin Cities

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Scores of workers across America have been laid off through no fault of their own, and still many of them are not eligible for federal benefits during these unprecedented times. In Minnesota’s Twin Cities, the Minneapolis Regional Labor Federation (MRLF) is organizing to provide support to those workers who can’t get the support they need from our federal government.

Led by President Chelsie Glaubitz Gabiou (UFCW), the MRLF is pioneering a new kind of initiative focused on filling that gap. The Twin Cities Hospitality Relief Effort is specifically designed to help laid-off hospitality workers who are being left behind. The labor federation is giving direct one-on-one assistance to dozens of these workers who need immediate help with health care, housing and money to survive.

“A lot of hospitality workers are not eligible for government assistance for a number of reasons: they receive much of their income from tips, they have families with mixed immigration status, they received a combination of wages and 1099 forms, or they worked for many different employers over the course of the year,” Glaubitz Gabiou explained. “These workers come from an industry that was the first to shut down, and they have a very long recovery ahead.”

The MRLF has 16 people trained to provide navigation services, and they are in place to keep the relief effort going. The navigators are doing direct outreach to those who need help the most, and they interact with community partners and government agencies to provide tailored support for each individual. They are a mix of union organizers, laid-off workers and labor federation staff, and many of them are bilingual. Their conversations with the people receiving help also has an organizing component, as the labor federation is promoting union values to these laid-off workers.

“The way that this team of front-line workers is coming together to take care of other workers in this industry is inspiring,” Glaubitz Gabiou said. “They’re helping people negotiate payment plans with their landlords, get access to active food resources and pharmaceuticals, and much more.” She pointed out that they have helped more than 150 laid-off workers and their families—90% of whom do not have access to unemployment insurance benefits.

The MRLF’s Twin Cities Hospitality Relief Effort is operating in close collaboration with its affiliates, including UNITE HERE Local 17, Theatrical Stage Employees (IATSE) Local 13 and the Restaurant Opportunities Centers United. The initiative is receiving financial support from the LIFT Fund, the city of Minneapolis, Ramsey County, Minnesota, the Greater Twin Cities United Way, the Minnesota Nurses Association-NNU and UNITE HERE. The coalition recently held an online bingo tournament that raised nearly $5,000. And this funding is being used to support the relief effort and provide $200 cash grants to those laid-off workers who meet minimum standards.

“We have to keep fighting and scraping for people to take seriously the state that all workers are in,” Glaubitz Gabiou said. “It’s not just about surviving right now; we’re working to make sure we recover more resilient in the future.”

This blog originally appeared at AFL-CIO on May 13, 2020. Reprinted with permission.

About the Author: Aaron Gallant is a contributor for AFL-CIO.


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Layoffs have high stakes for foreign nationals and their employers

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As society reacts to the spread of COVID-19, businesses are making difficult decisions. Despite the government’s interventions to encourage continuity in the workforce, unemployment is at historic rates and still rising.

This creates high stakes for employers of foreign nationals. The inflexible regulatory scheme governing such employment did not anticipate COVID-19.  It’s important to approach layoffs, hours reductions, and furloughs with a concrete plan: the impact on foreign workers must be taken into account before your company takes action.

Temporary Furloughs and Reductions in Hours Worked

The H-1 and E-3 visa categories require the filing of a Labor Condition Application (LCA) with the Department of Labor and are governed by DOL wage regulations.  An employer must pay these employees the greater of (1) the actual wage rate paid by the employer to all other individuals with similar experience and qualifications for the specific job, or (2) the prevailing wage for the occupational classification in the geographic area of intended employment.  This required wage must be paid, even if the employee is not performing work and is in a nonproductive status.  The temporary furlough of such an employee would therefore lead immediately to a violation of the LCA and a potential claim by the employee against the company.  Reductions in hours worked could also lead to LCA violations where the LCA was based on full-time employment.

There is no easy way out of this problem.  Foreign national employees may not be treated better than U.S. workers, so exempting them from such measures is not an option.  An employer’s only choice may be to amend an H-1B petition to reflect the change in working conditions, which is expensive and cumbersome, or to terminate the foreign national’s employment outright.

This situation is much more flexible for foreign workers not in H-1B, H-1B1 or E-3 status.  Such employees may generally be treated the same as U.S. workers without the need to amend an underlying visa petition.

Permanent Layoffs

Immigration regulations require employers of individuals in the H-1, L-1 and O-1 visa categories to immediately notify USCIS of material changes in the terms and conditions of employment.  What constitutes a material change is not always clear, but termination of employment is plainly material.  Written notice to USCIS would be sufficient for all except H-1B employees.

Employers of terminated H-1B employees – whether through layoff or otherwise — must notify USCIS immediately by withdrawing the H-1B petition.  The employer must also offer to repatriate the employee — pay the cost of the employee’s trip home if the employee chooses to depart the U.S.

F-1/STEM OPT Issues

There are also certain obligations for employers of F-1 nonimmigrant students who are employed pursuant to STEM OPT work authorization.  The STEM OPT period is governed by the Form I-983 training plan, which contains an employer certification.  Among other things, the Form I-983 includes the student’s salary and the agreed-upon number of hours worked per week.  The employer is responsible for notifying the student’s Designated School Official (DSO) regarding any material change to the training plan, including any reduction in compensation or any significant decrease in hours worked per week.  The employer also must notify the DSO within five business days of the termination of the student during the authorized STEM OPT period.

Permanent Residency Issues

If the company has filed an immigrant petition, or I-140, or an employee who is laid off, the employer should withdraw the I-140 petition.  However, the employee may be able to join a new employer and maintain the benefit of the prior approved I-140 petition and the established priority date, so long as the I-140 petition has been approved for at least 180 days.

Layoffs may affect not only the individual employee(s) laid off, but they can also have a significant effect on the green card process for other employees as well.  If the company has had a layoff within the last six months in the area of intended employment of the PERM job or a related job, the employer may not be able to file the PERM application.  This may delay the filing of PERM applications for employees, and may prevent the employer from sponsoring an employee for a green card altogether if the employee does not have sufficient time remaining in their nonimmigrant status.

In this tumultuous time, if your business is being forced to consider layoffs or if you are a foreign national employee who has been recently laid off, be sure to speak with an immigration attorney that is well versed in the nuances of both the regulations and these unusual circumstances.

Printed with permission.

About the Author: Leslie Ditrani is Co-Managing Partner of Chin & Curtis, LLP and has been practicing immigration law for more than 25 years. Working closely with employers to hire and retain talent, she and the firm represent a wide range of enterprises from start-ups and entrepreneurs to large, multi-national businesses. Leslie is known for her broad expertise in business and family immigration matters, and her dedication to finding creative and effective solutions.


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Trump administration wants states to zip their lips about soaring unemployment numbers

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Unemployment is skyrocketing as entire industries shut down or scale back dramatically in response to the coronavirus pandemic. Unemployment claims rose 30% last week, with 281,000 newly jobless people filing for unemployment insurance. But the numbers that are still to come are going to be much worse. How much worse? Well, the Labor Department is asking states not to give any numbers until the official report comes out, because the financial markets will see and it will be bad.

On Wednesday, the Labor Department’s administrator of the Office of Employment Insurance (a career official, not a political appointee) sent state officials an email telling them to “provide information using generalities to describe claims levels (very high, large increase).” Perhaps state officials should pay a visit to Thesaurus.com for some help, and tell the public, “We can’t give you exact numbers here, but there has been an enormous/giant/gigantic/hefty/huge increase in unemployment claims this week. For exact numbers, wait until the federal government releases them next week.” That will surely ease anxieties!

Washington state’s new unemployment claims rose by 150% last week—and while officials there aren’t giving numbers, they did say there’s an “even more dramatic increase this week.” In Pennsylvania, a state labor official told lawmakers and union leaders that there had been 180,000 new unemployment claims in recent days. That’s more than the state typically sees in a month.

It sounds like we might need to go back to the thesaurus to convey the magnitude of the job losses going on. How about gargantuan? Immense? Massive?

Or maybe—here’s a thought—numbers. Waiting until Thursday to know the scope of the economic crisis is not going to calm anyone down. We saw that when Donald Trump attempted to downplay the coronavirus crisis because he was worried about how the markets would respond, and the markets tanked anyway. Everyone knows things are really, really, really bad out there. Knowing that the government is being transparent would at least be one piece of good news.

This article was originally published at Daily Kos on March 20, 2020. Reprinted with permission.

About the Author: Laura Clawson is a Daily Kos contributor at Daily Kos editor since December 2006. Full-time staff since 2011, currently assistant managing editor.


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