VIEWPOINT: Slow Delaware workforce rebound needs bold corrective action

Delaware is one of five states that had fewer unemployment claims in the week starting Aug. 30 than it did before the pandemic. 

Rob Martinelli
President
Today Media Inc.

That’s the good news from WalletHub, which has been tracking which states’ workforces are experiencing the quickest recovery from COVID-19. The bad news is that Delaware ranks 50th, ahead of only Rhode Island, among states and Washington, D.C., that have recovered the most since the start of the crisis. 

On Sept. 29, WalletHub released a similar report looking at cities and ranked Wilmington 140th and Dover 154th, with nearly 40% higher rates this past August than August 2019 and August 2020 (27.4% for Wilmington and 37.75% for Dover). Most of the higher-ranking cities either had lower unemployment to start with or have seen big decreases in recent months. Wilmington and Dover had August unemployment rates of 8.3% and 8.6% respectively, well above the 5.2% national average. 

WalletHub analyst Jill Gonzalez told me that “the study is meant to be an indicator of the recovery of the job market [by identifying] which states’ workforces are experiencing the quickest recovery from the pandemic by comparing changes in the number of unemployment claims filed over several periods of time.”

I agree. While individual state numbers may be off, you can look at these as valid from a relative standpoint. 

Gonzalez added that “the number of unemployment insurance initial claims in Delaware had dropped by more than 6% at the beginning of September, compared to the same week of 2019, meaning it’s finally below pre-pandemic levels. However, when we compare the change registered during the past six months to the same period of last year (the first six months of the pandemic), Delaware ranks second to last, with a decrease in unemployment claims of less than 50%. This means that the state was hit very hard at the start of the pandemic, and that recovery was more difficult. The fact that Delaware ranks fifth for the most recent week means that the state has only now gained traction in terms of unemployment recovery.”

But why is that?

In the study, WalletHub found that “red states” recovered more quickly on average than “blue states” like Delaware. In fact, Delaware’s jump in the rankings happened in the same week that the federal unemployment benefits expired. What else happened that week? We saw an uptick in hospitality companies promoting new worker bonuses, including Grotto Pizza launching a signing bonus of up to $500. 

I believe this report highlights the importance of Delaware being even more aggressive about getting residents back to work. We can start by using the mountain of cash the state is sitting on (thanks in part to an inflow of pandemic money) to quickly expand the excellent job-training programs, support efforts by small business to attract workers including funding signing bonuses for residents coming off unemployment, and approving the oft-delayed Ready in Six recommendations for streamlining Delaware’s permitting process and getting more projects up and running.

This is a serious problem that needs bold action.

Rob Martinelli is the president and CEO of Today Media, the parent company of Delaware Business Times.