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Coronavirus Government News

Delaware unemployment claims fall again, spike coming next week

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WILMINGTON – More than 5,000 Delaware workers filed unemployment claims last week, the sixth consecutive week of declining totals, but a spike of claims may be coming in the next weekly report, officials said.

In total, 5,197 new claims were filed in the week ending May 9, pushing the total claims filed during the coronavirus pandemic to 90,270, the Delaware Department of Labor reported Thursday.

The unprecedented totals in unemployment claims has surpassed the total of the last three years’ claims combined but isn’t representative of how many workers are unemployed permanently, as employers statewide utilize temporary furloughs to cut expenses.

The data shows that roughly 19% of the state’s workforce has filed an unemployment claim in the crisis, although some of those claims were denied, some of the workers have returned to their jobs after temporary furloughs and others likely went back to work May 8, when the state lifted some restrictions on commerce.

As of last week, 58,723 workers are receiving unemployment insurance payments from the state, an increase of more than 2,000 from the prior week. The insured unemployed data represents a state unemployment rate of about 12%.

While the weekly claims have fallen for more than a month, state labor officials also warned that next week’s report may break that streak. That is due to the new eligibility of self-employed workers and independent contractors to file claims under a new system set up via the federal CARES Act.

Despite federal unemployment aid being extended to them in March, such workers, who don’t pay into the state’s unemployment trust fund to be insured against job losses, hadn’t been able to tap into relief funds because of a lack of a state system to verify their incomes. That system, integrated with the Internal Revenue Service, is now online.

DOL reported that 14,236 claims have been submitted so far through that system which went live May 11 and will be reflected in next week’s report. Those claims, filed under the federal Pandemic Unemployment Assistance program include those who have previously filed for benefits and been denied, as well as those applying for the first time. Those workers will be eligible for payments ranging from $733 to $1,000 per week, depending on proof of income documentation.

That wave of assistance seekers has overwhelmed the manpower of the department and required federal stimulus funds to bolster the depleted state Unemployment Trust Fund, which has paid out $188 million in claims from March 15 to May 9. A historic weekly high for payments has been about $3 million, but last week saw payment of $45.7 million.

The state’s trust fund has seen an infusion of more than $109 million from the federal government, while the state has paid out more than $78 million through the crisis, DOL reported.

The enormous weekly payments from the fund was a concern of employers who worried that an exhausted trust fund may result in rising unemployment insurance rates to ensure coverage. Those concerns were recently assuaged a bit by a recent federal ruling.

In a Monday conference call with the New Castle County Chamber of Commerce, U.S. Sen. Chris Coons (D-Del.) noted that the U.S. Department of the Treasury ruled recently that states could use money allocated to jurisdictions from the CARES Act to replenish unemployment insurance trusts. The senator added that he was working on more funding to help the public sector weather the financial hit of the pandemic.

“Frankly, I’ve heard from many of you about a grave concern that as soon as possible the unemployment insurance rate will skyrocket because Delaware’s fund is nearly depleted or now is depleted,” Coons said. “It is the top priority for my caucus in the Senate that the next round of funding prioritizes state and local governments and give them flexibility to deal with revenue shortfalls.”

Editor’s note: This story originally reported that the 14,236 claims filed under the federal Pandemic Unemployment Assistance program were in excess of the claims already filed. Actually, many of those PUA claims are among the 90,240 filed to date.

By Jacob Owens

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