Jobless Just the Start
Terry H. Schwadron
March 27, 2020
Confirmation that there were more than 3 million jobless claims filed this week prompted an immediate, communal shriek at the sheer size of the number.
Agreed: It is an amazing number of people sitting home — against their will and decision — and it is historic for being many multiples of the standard number of jobless ill.
But I am a little more surprised at the reaction than at the claims total. Here’s why.
First, isn’t this vast jobless filing exactly what we expected would happen when the nation basically adopted social distancing and more than 20 states ordered lockdowns at home? Isn’t this kind of number the point of Donald Trump throwing medical caution to the wind to consider letting everything open up again in two weeks?
Secondly — call me nuts — but I thought that whole discussion in Washington was about the Congress passing a $2 trillion emergency aid bill was to deal through direct payments, increased unemployment support and a bailout money to companies and industries that promise to keep employees on the payroll.
Indeed, if all the small businesses and bigger companies lining up to take money keep that promise, will we be surprised that the 3 million total tumbles?
Thirdly, If we truly are surprised by this number, what do we think is going on in 150 other countries around the world, with global competition for worst-case scenario?
And lastly, if there is surprise about this number, you ain’t seen nothing yet: The Economic Policy Institute is projecting at the current rate, we could see 14 million jobless claims by summer.
I’m thinking the reaction is as much because we don’t understand numbers as it is the difficulties associated with protecting and releasing a population of disease-immune workers back into the workplace wild.
From where I sit, there are two issues: Getting people paid now, and starting in earnest to discuss how to return workers to their jobs, presuming that those businesses that had employed them before will re-open. Given the bumpy way that the Donald Trump administration and official Washington have handled the coronavirus altogether, we should not be expecting a well-considered plan.
Indeed, for Trump to rise on his hind legs to bay at the medical world for a chance to return to normal in two weeks just shows the level of unthinking that is behind the decision-making.
Let’s talk about the congressional bill to offer cash payments, offer small business loans that can be forgiven for keeping all employees on the payroll and bailouts to bigger firms and industries seen as hardest hit, and to make payments to the states, where the real action is. The bill did lots that is helpful to individuals and businesses alike, and, in throwing out all the rules about deficit spending, is a vast attempt to protect the national economy while still dealing with contagion.
At the outset, practicalities make full understanding difficult. What happens to small businesses who already laid off workers, but now want to rehire them, removing them from jobless claims? There is more rule-making to come.
The decisions to put emphasis on workers, including for the first time, freelancers and those from the gig economy, and to tie business aid to continued employment were huge, even if at the price of extended negotiation and partisan bickering until the end. So too with financial assistance now is being made available to countless nonprofits that depend on Medicaid funding, such as home and community-based disability services providers, community-based nursing homes, health centers and mental health providers and rape crisis centers.
The biggest piece, of course, is paying unemployment benefits plus the bonus added before the bill passed. That should assure those idled for three or four months.
But I’m wondering what happens to all the jobless claims if and when businesses actually act to return employees to their payrolls — even if they are still required to work from home. Logic says those jobless claims need to return to more imaginable levels.
Whether through business subsidy or increase unemployment benefits, this is big government stepping in to fill in for missing job pay. In effect, the strategy is to pay individuals or to pay businesses, large and small, not to close or lay off workers. What is not clear is how we will know whether small businesses actually do re-hire the workers they laid off two weeks ago, how quickly loans come through and how we enforce all of this. For larger firms, Republicans finally conceded that an impartial umpire ensure that monies, loans and loan guarantees go to companies that actually use the aid for workers.
Still, it seems like much of all this is built on promise and a desire to return to normal.
What is totally unclear is how all of us are going to move from home back into a more recognizable work in factories, offices and storefronts without restarting the cycle of virus.
The expectation is that we are developing an easier antibody test to determine whether previously infected virus victims now are immune from re-infection. In the health industries, workers must be tested for infections before starting work, though it is difficult right now to understand exactly how every business in the country will have its employees undergo even such antibody testing, who pays for it, or how we match needed business skills against the resulting workforce.
Given its record, it is beyond belief that the federal government will be able to figure out how to manage such an effort.
The new normal is going to be anything but normal.