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Tag: unemployment

Northam orders companies held temporarily harmless for pandemic layoffs

Gov. Ralph Northam issued an executive order Tuesday that will hold Virginia businesses harmless for any layoffs made during three months of the pandemic. The end-of-year order protects businesses from having to pay an additional $200 million in payroll taxes to replenish the Virginia Employment Commission’s Unemployment Insurance Trust.

Due to the COVID-19 economic fallout, 1.4 million Virginians have filed for unemployment this year, more than 10 times the number of claims filed in 2019.

The trust, which is used to pay state unemployment benefits to eligible Virginians, was left empty in October. The fund had started the year at 86% solvency, with $1.45 billion in its coffers. In July, the commission anticipated a record deficit of $750 million by the end of the year.

As of December, the VEC paid out more than $9.7 billion to unemployed Virginians, most of which came from the federal government via $600 weekly supplemental unemployment checks and payments for gig workers, said Megan Healy, the state’s chief workforce development adviser.

After the General Assembly’s most recent special session, which ended in October, the adjusted state budget included $210 million to backfill the trust fund. The state is currently borrowing from the Department of Labor to pay out state unemployment benefits, which top out at $378 per week per person.

“Since the start of this pandemic, the commonwealth has distributed more than $9.7 billion in benefits to hundreds of thousands of Virginians, helping them get through these hard times,” Northam said in a statement. “I am proud of what the Virginia Employment Commission has been able to accomplish, but there is still unprecedented need. In the face of federal inaction, these changes will put more of our unemployment insurance funding into the hands of unemployed workers and small business owners who desperately need it.”

In early August, the VEC reached its peak of initial claims for unemployment, although the state has seen another spike in new claims in December. More than 16,650 people filed claims in the week ending Dec. 5, and 14,509 people filed claims the following week. Meanwhile, 68,019 Virginians remained unemployed last week, VEC reported.

Without the order holding companies temporarily harmless for layoffs, businesses would be forced to pay higher state payroll taxes to refill the trust, which is funded by a combination of taxes, pool charges and a fund builder. The tax base rate is based on an employer’s history with layoffs and furloughs, while pool charges are used to offset employee losses that aren’t the employer’s fault. The fund builder is covered by all employers when the trust fund balance solvency drops below 50%. At that point, employers are taxed an additional 0.2% and pay federal unemployment tax of $420 per employee.

Pool charges and fund builder taxes, which all businesses pay, will increase slightly in 2021, Healy said. The state sets unemployment insurance employer tax rates annually, with 2021’s levies assigned for the state’s 2020 fiscal year, which ran from July 1, 2019, to June 30, 2020. Each business receives its base tax rate, but the new executive order requires that the VEC not penalize businesses for layoffs that occurred from April through June 2020.

Healy said Tuesday that the state’s Commission on Unemployment Compensation will meet Wednesday to discuss how to refill the trust without overtaxing businesses. Meanwhile, the governor also directed the VEC to immediately begin distributing payments to unemployment applicants whose claims have been delayed.

“The Virginia Employment Commission remains focused on providing relief for Virginia businesses and workers during these unprecedented times,” VEC Commissioner Ellen Marie Hess said in a statement. “These actions will ease the burdens on families and businesses and help our economy grow.”

In a statement, National Federation of Independent Business Virginia Director Nicole Riley called the executive order “a big relief for Virginia’s small businesses. Gov. Northam’s decision to waive the charges for employers who laid off or furloughed workers will relieve some of the financial pressure on Virginia’s small businesses and make it easier for them to get back on their feet and put people back to work.”

 

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Pandemic brings end to decade of job gains

The public health crisis brought an unanticipated end to 11 straight quarters of economic growth and nearly a decade of job gains in Virginia, according to Old Dominion University’s 2020 State of the Commonwealth Report, released on Dec. 20 by ODU’s Dragas Center for Economic Analysis and Policy.

“The COVID-19 pandemic has dramatically affected how Virginians live and work,” Dragas Center Director Robert M. McNab said in a statement. “While Virginia has, comparatively, fared better than many other states, unemployment is higher, food security is lower and Virginians are left to ponder the question of when life will return to some semblance of normality.”

Last year, prior to the pandemic, ODU’s 2019 State of the Commonwealth Report predicted a sixth straight year of economic growth, low unemployment and income increases. Instead, real gross domestic product (GDP) shrank by 27% during the second quarter of 2020, and 2021’s recovery pace depends on how quickly vaccines can be deployed. 

Entering 2020, Virginia’s unemployment rate was below 3%, according to the report, while the most recent unemployment rate in Virginia is 4.9%. And while Virginia added approximately 502,000 jobs from February 2010 to February 2020, this year saw 438,000 workers temporarily furloughed or permanently laid off by April 2020, according to the report.

“Looking back on these times is an exercise fraught with nostalgia,” according to the report. “We now live in a world where our temperatures are checked, questions about our health are asked and exposure to the coronavirus means, at a minimum, a two-week quarantine.”

Survey data compiled by the Dragas Center showed that by the end of November, one in nine Virginia businesses had decreased its number of paid employees.

“From the peak of February 2020 to April 2020, the size of Virginia’s civilian labor force fell by 3.3%,” according to the report. “Over the same period, individual employment declined by 11.8%, or approximately 513,385 people. In the span of two months, one in nine Virginians moved from gainful employment to a temporary furlough or, in some cases, a permanent layoff.”

The report suggests that a possible explanation for the dramatic decline in the civilian labor force is attributable to the impact of COVID-19 on child care and primary education. Reports sources suggest that keeping schools closed could affect up to 50 million workers and could encroach on 15% of annual GDP.

ODU’s report also focused on the disproportionate impact that the pandemic has had on minority communities and particularly African American communities. African Americans comprised more than 39% of continued unemployment claims in October. And as of Nov. 28, African Americans accounted for 27% of COVID-19 deaths in Virginia, despite comprising only about 19% of the state’s population, according to the U.S. Centers for Disease Control and Prevention.

“If anything, the pandemic has thrown the fractures of our society into sharp relief,” McNab said in a statement.

The Dragas Center has produced the State of the Commonwealth Report since 2014.

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Va. unemployment rate fell less than 1% between October and November

Virginia’s seasonally adjusted unemployment rate fell by less than 1% between October and November to 4.9%, according to employment statistics released Friday by the Virginia Employment Commission — but unemployment still remains 2.2% higher than the same time last year.

The labor force grew by 0.4% to 4.28 million between October and November, while the number of employed Virginians increased by more than 24,000 to 4.05 million. Non-agriculture jobs rose by 28,787 and the private sector gained 13,800 jobs. The public sector payroll lost 5,700 jobs, however. 

The largest monthly job gains during November were in professional and business services (adding 6,800 jobs) and education and health services (adding 3,800 jobs). Other sectors that saw increases included construction (adding 3,400 jobs), leisure and hospitality (adding 2,000 jobs) and trade and transportation (adding 900 jobs), among other industries. Government employment, manufacturing, and information services were the only major industry sectors that reported jobs lost. 

Despite some job recovery, 10 out of the 11 major industry divisions in Virginia reported declines compared to last year. Leisure and hospitality was down by 66,800 jobs, compared to November 2019, while education and health sciences were down by 32,700 jobs. Government, professional and business services, manufacturing, trade and transportation, finance and mining also reported major losses. Construction is the only industry that was up by 12,200 jobs compared to the same period in 2019.

Regionally, the largest job increases during November happened in Richmond, which added 6,000 jobs. The Charlottesville, Blacksburg/Christiansburg/Radford, Roanoke, Eastern Virginia, Northern Virginia, Harrisonburg, Staunton/Waynesboro regions also reported job gains, while job losses were reported in the Winchester area.

 

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14K+ Virginians filed initial jobless claims last week

The number of initial jobless claims filed last week reached close to its Aug. 8 peak, with more than 14,000 Virginians filing initial unemployment claims, according to Virginia Employment Commission data released Thursday.

The week prior, initial claims reached more than 16,000. While there was a 12.9% decrease in claims from the previous week, the number of Virginians filing initial claims for unemployment remains well above figures from recent months and from comparable figures last year.

For the week ending Dec. 12, 14,509 Virginians filed initial claims for unemployment, a decrease of 2,145 claimants from the previous week.

Last week, 68,019 Virginians remained unemployed — 48,791 higher than the 19,228 continued claims from the same period last year. People receiving unemployment benefits through the VEC must file weekly unemployment claims in order to continue receiving benefits.

“This drop indicated a resumption of its recent declining trend and was over 80% lower than its May 16 filing week peak,” according to the VEC. “The continued claims total is mainly comprised of those recent initial claimants who continued to file for unemployment insurance benefits during the COVID-19 pandemic.”

The regions of the state that have been most impacted continue to be Northern Virginia, Richmond and Hampton Roads. 

Below are the top 10 localities, listed by number of initial unemployment claims, for the week ending Dec. 12:

  • Fairfax County, 1,009
  • Virginia Beach, 850
  • Prince William County, 769
  • Richmond, 584
  • Norfolk, 558
  • Henrico County, 456
  • Chesterfield County, 424
  • Chesapeake, 347
  • Portsmouth, 274
  • Loudoun County, 270

Nationwide, the advance figure for seasonally adjusted initial claims for last week was 885,000, an increase of 23,000 from the previous week’s revised level, according to the U.S. Department of Labor. There were 270,547 initial claims during the same week last year.

 

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Va. jobless claims fall to lowest level since March

The number of initial jobless claims filed last week fell to its lowest level since the pandemic’s employment effects began to be felt in mid-March, the Virginia Employment Commission reported Thursday.

Initial jobless claims in Virginia dropped by 29.7% last week compared with the previous filing week, according to the VEC, while continued claims fell by 10.9%.

For the week ending Nov. 28, 8,606 Virginians filed initial claims for unemployment, a decrease of 3,628 from the previous week. 

Last week, 72,305 Virginians remained unemployed — 55,308 higher than the 16,997 continued claims from the same period last year. People receiving unemployment benefits through the VEC must file weekly unemployment claims in order to continue receiving benefits.

“This drop indicated a continuation of its recent declining trend and was over 80% lower than its May 16 filing week peak,” according to the VEC. “The continued claims total is mainly comprised of those recent initial claimants who continued to file for unemployment insurance benefits during the COVID-19 pandemic.”

The regions of the state that have been most impacted continue to be Northern Virginia, Richmond and Hampton Roads. 

Below are the top 10 localities, listed by number of initial unemployment claims, for the week ending Nov. 28:

  • Prince William County, 567
  • Virginia Beach, 495
  • Fairfax County, 485
  • Norfolk, 450
  • Richmond, 293
  • Portsmouth, 209
  • Augusta County, 200
  • Chesterfield County, 166
  • Henrico County, 160
  • Newport News, 155

Nationwide, the advance figure for seasonally adjusted initial claims for last week was 712,000, a decrease of 75,000 from the previous week’s revised level, according to the U.S. Department of Labor. There were 216,827 initial claims during the same week last year.

For the month of October, the unemployment rate in Virginia fell from 6.1% to 5.1% when compared to September, and was 1.5% lower than the national rate, according to the VEC.

The Harrisonburg region reported the lowest unemployment rate in Virginia at 3.6% in October, while the Bluefield region in Southwest Virginia showed the highest unemployment rate at 6%. The Bluefield, Richmond and Norfolk/Newport News micropolitan statistical areas were the only regions in Virginia to report unemployment rates higher than the state average for the month.

The localities with the lowest unemployment rates for October include:

  • Highland County, 2.5%
  • Madison County, 2.8%
  • Poquoson County, 2.9%
  • Rockingham County, 3.2%
  • Falls Church, 3.2%

The localities with the highest unemployment rates for October include:

  • Petersburg, 13.8%
  • Emporia, 10.6%
  • Hopewell, 9.9%
  • Martinsville, 9.5%
  • Portsmouth, 9.1%

 

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Labor market continued slow recovery in early November

The labor market continued its slow recovery during the week of Nov. 8, according to Virginia Commonwealth University and Arizona State University economists.

Early November saw 69.9% of working age adults employed, which is still far below the 73.8% employment rate from February right before the pandemic, according to the Real-Time Population Survey conducted by VCU assistant economics professor Adam Blandin and Arizona State associate economics professor Alexander Bick.

“The latest [Real-Time Population Survey] results show that, since April, employment has recovered three-quarters of the way back to the pre-pandemic level,” Blandin said in a statement.

Early November also showed an increase in earnings relative to the spring. More than one-third among those employed in February reported an earnings loss in early April. This declined to one-fourth in the most recent survey. 

“Together, these results indicate that some of the earnings losses suffered early in the pandemic were temporary in nature,” according to the report.

The Real-Time Population Survey closely follows the methodology of the U.S. Bureau of Labor Statistics’ Current Population Survey and covers the same time period, but is released two weeks earlier. The survey is conducted in collaboration with the Federal Reserve Bank of Dallas.

 

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Va. unemployment rate fell less than 1% between September and October

Virginia’s seasonally adjusted unemployment rate fell by less than 1% between September and October to 5.3%, according to employment statistics released Friday by the Virginia Employment Commission — but unemployment still remains 2.6% higher than the same time last year.

The labor force fell by 0.4% to 4.27 million while the number of employed Virginians increased by more than 24,000 to 4.05 million. Non-agriculture jobs rose by 34,000 and the private sector gained 36,700 jobs. The public sector payroll lost 2,700 jobs, however. 

The largest monthly job gains during October were in leisure and hospitality (adding 13,300 jobs) and trade and transportation (adding 8,400 jobs). Other sectors that saw increases included professional and business services (adding 7,600 jobs), education and health services (adding 3,300 jobs) and construction (adding 3,100 jobs), among other industries. 

Government employment and finance were the only major industry sectors that reported jobs lost. There was a 3,600-worker loss in government jobs, and finance saw employment fall by 1,400.

Despite some job recovery, 10 out of the 11 major industry divisions in Virginia reported declines compared to last year. Leisure and hospitality was down by 66,100 jobs, compared to October 2019, while education and health sciences were down by 34,800 jobs. Government, professional and business services, manufacturing, trade and transportation, finance and mining also reported major losses. Construction is the only industry that was up by 6,900 jobs compared to the same period in 2019.

Regionally, the largest job increases during October happened in Northern Virginia, which added 8,100 jobs during October. The Richmond, Eastern Virginia, Roanoke, Charlottesville, Lynchburg and Winchester regions also reported job gains, while job losses were reported in the Harrisonburg area.

 

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Initial jobless claims rise as extended benefits come to an end

As the U.S. Department of Labor notified the Virginia Employment Commission that the state’s extended benefits program would end on Nov. 21, more than 11,000 Virginians filed initial jobless claims and more than 85,000 filed continued claims.

Under the extended benefit program, Virginians who had already used regular unemployment insurance benefits as well as any pandemic emergency unemployment compensation could receive up to an additional 13 weeks of benefits, but those who were eligible will not receive payments past Nov. 21. The Labor Department is ending the extended benefits program for Virginia residents due to overall gains in employment.

The number of initial jobless claims in Virginia rose by 11.9% last week compared with the previous filing week, the Virginia Employment Commission reported Thursday, while continued claims fell by 7.4%.

For the week ending Nov. 14, 11,088 Virginians filed initial claims for unemployment, an increase of 1,179 from the previous week. 

Last week, 85,129 Virginians remained unemployed — 67,529 higher than the 17,600 continued claims from the same period last year. People receiving unemployment benefits through the VEC must file weekly unemployment claims in order to continue receiving benefits.

“Over half of claims were in the accommodation/food service, health care, administrative support and retail trade industries,” according to the VEC. “The continued claims total is mainly comprised of those recent initial claimants who continued to file for unemployment insurance benefits during the COVID-19 pandemic.”

The regions of the state that have been most impacted continue to be Northern Virginia, Richmond and Hampton Roads. 

Below are the top 10 localities, listed by number of initial unemployment claims, for the week ending Nov. 14:

  • Fairfax County, 861
  • Prince William County, 610
  • Richmond, 608
  • Virginia Beach, 603
  • Norfolk, 556
  • Henrico County, 285
  • Chesapeake, 231
  • Chesterfield County, 226
  • Newport News, 219
  • Portsmouth, 216

Nationwide, the advance figure for seasonally adjusted initial claims for last week was 742,000, an increase of 31,000 from the previous week’s revised level, according to the U.S. Department of Labor. There were 227,892 initial claims during the same week last year.

 

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Initial jobless claims fell again last week

The number of initial jobless claims in Virginia dropped by 4.3% last week compared to the previous filing week, the Virginia Employment Commission reported Thursday, while continued claims fell by 7.8%.

For the week ending Nov. 7, 9,909 Virginians filed initial claims for unemployment, a decrease of 441 from the previous week. 

Last week, 91,960 Virginians remained unemployed, a 7.8% decrease from the previous week, but 73,760 higher than the 18,200 continued claims from the same period last year. People receiving unemployment benefits through the VEC must file weekly unemployment claims in order to continue receiving benefits.

“Over half of claims were in the accommodation/food service, health care, administrative support and retail trade industries,” according to the VEC. “The continued claims total is mainly comprised of those recent initial claimants who continued to file for unemployment insurance benefits during the COVID-19 pandemic.”

The regions of the state that have been most impacted continue to be Northern Virginia, Richmond and Hampton Roads. 

Below are the top 10 localities, listed by number of initial unemployment claims, for the week ending Nov. 7:

  • Fairfax County, 651
  • Prince William County, 607
  • Richmond, 528
  • Virginia Beach, 511
  • Norfolk, 361
  • Chesterfield County, 302
  • Henrico County, 289
  • Portsmouth, 203
  • Newport News, 197
  • Loudoun County, 191

Nationwide, the advance figure for seasonally adjusted initial claims for last week was 709,000, a decrease of 48,000 from the previous week’s revised level, according to the U.S. Department of Labor. There were 238,996 initial claims during the same week last year.

 

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Construction industry recovered 84K jobs in October

While the pandemic surges on, the construction industry added 84,000 net new jobs in October, the Associated Builders and Contractors (ABC) announced Friday. During the past six months, the industry has added 789,000 jobs, recovering 73% of jobs lost during the pandemic.

“It’s hard not to stand up and applaud the U.S. economy’s ability to recover,” ABC Chief Economist Anirban Basu said in a statement. “Despite political uncertainty, a lingering pandemic, global tumult, and a lack of major new stimulus since April, America’s economy continues to show forward momentum.

In October, nonresidential construction added nearly 60,000 jobs, with increases in nonresidential specialty trade contractors, heavy and civil engineering and nonresidential building. 

The construction unemployment rate dropped by 0.3% to 6.8% when compared to September, but is still up by 2.8% when compared to the same time last year when nonresidential construction employed nearly 208,000 more people than it does today, according to ABC.

“Nonresidential construction’s momentum is especially impressive,” Basu said in a statement. “Despite tighter lending conditions, negatively impacted state and local government finances and deteriorating commercial real estate fundamentals, nonresidential construction experienced job creation in each of its three major segments.”

Basu also warns that contractors should remain “on guard,” however. 

“Cash management will be particularly important going forward,” Basu said in a statement. “Another recession is possible as COVID-19 rages across the nation, driving up hospitalizations. While household spending will continue to be a source of positive momentum, state-mandated economic lockdowns are likely to become more of a factor during the weeks ahead. That would result in an interruption to the robust recovery that has been building since May, and would delay the arrival of nonresidential construction’s complete recovery.”

 

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