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Coronavirus Economic Development News

Del. unemployment reaches 14% in April as about 75K jobs lost

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DOVER – Delaware’s unemployment rate reached a modern record of 14.3% in April, as the state reportedly lost nearly 75,000 jobs in response to the coronavirus pandemic, officials reported Friday.

The state’s seasonally adjusted unemployment rate was in line with the national rate, which sat at 14.7% in April, but it marked a huge jump from Delaware’s 5% March unemployment rate.

At 14.3%, it is also the state’s highest recorded monthly unemployment rate, according to the U.S. Bureau of Labor Statistics (BLS), which started tracking state figures in 1976. It is also 46% higher than the previous record of 9.8% in November and December 1976. The highest monthly rate recorded in the past decade was 8.8% in January 2010, just as the full impact of the Great Recession was felt.

The Delaware Department of Labor’s report, which is taken monthly during the calendar week that contains the 12th day, showed that 66,700 workers were unemployed. Tom Dougherty, chief labor market economist for the department, explained that the monthly unemployment figure is created from looking at continuous unemployment insurance claims as well as a BLS survey of residents on their employment status.

The official monthly unemployment statistic tracks not only those receiving benefits, but also those who ineligible, such as terminated employees and the self-employed, who only became eligible for assistance under a special federal program established under the CARES Act.

While more than 95,000 workers have filed for unemployment assistance in the wake of the pandemic, most because of statewide business closures mandated by Gov. John Carney to stem the spread of the virus, the state also had 19,400 unemployed workers in January, before the pandemic struck the U.S.

Dougherty said it’s important to remember that the monthly report is just a “snapshot” of one week in time.

“People are trying to reconcile the initial claims with the unemployment numbers and that’s not easily done,” he said.

The state’s three counties saw similar rates of unemployment with New Castle, Kent and Sussex counties reporting rates of 14.1%, 15.8% and 16%, respectively. However, Wilmington and Dover, the state’s two most populous cities, have seen an even greater impact in job losses, where roughly one in five workers was unemployed.

The 74,700 job losses between the March and April labor reports were not spread evenly over sectors, as expected. The leisure and hospitality sector, which includes hotels, restaurants, entertainment venues and more that were virtually shuttered amid the crisis, sustained 26,500 job losses, or more than one out of every three jobs lost.

Also hit hard was the education and health sector, which saw schools and universities close buildings and hospitals temporarily end elective procedures due to the pandemic. It saw job losses of 13,600 in April.

The retail sector, which saw small- and medium-sized retailers close to customers, but larger stores add staff to meet increased demand, shed 10,800 jobs.

With the loss of so many jobs in the hospitality and retail sectors, which typically pay lower wages, the average weekly wage for the 390,600 who remained employed in April actually rose by more than $60.

Perhaps what’s more concerning, however, is the 12,300 people who in April dropped out of the labor force and may not look for work after the pandemic subsides. The state’s labor force has shrunk about 5% from its record high in February.

“This has been a quick-moving event, so employment as fallen quicker than unemployment has risen,” Dougherty said. “Maybe they’re not looking for a job or maybe they feel discouraged with what’s happening. There’s a lot of factors that go into play with the labor force.”

By Jacob Owens

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