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Jobless rates rose and the economy trembled in January under the impact of the renewed surge in the pandemic — especially in hard-hit Arizona.

During the first week of 2021, 1.15 million workers nationally filed new claims for unemployment, according to the U.S. Labor Department. Another 284,000 filed for Pandemic Unemployment Assistance, which covers freelancers, part-time workers and the self-employed normally ineligible for unemployment.

That’s the highest total since July and compares to the roughly 200,000 people per week filing for unemployment prior to the pandemic.

The economy lost 140,000 jobs in December, reversing the slow improvement underway since mass layoffs last spring. Overall, the economy has replaced almost half of the 21 million jobs lost when businesses shut down across the nation.

Arizona jobless claims on Jan. 4 increased 23% over the week before, according to a compilation of Department of Labor statistics on the WalletHub website. That means Arizona has the 10th highest rate of increase in unemployment claims nationally, a number that reflects the state’s soaring rate of COVID-19 cases.

Arizona saw a 508% increase in claims for that first week compared to the same week a year ago, before the pandemic hit.

A runaway increase in COVID-19 cases in Arizona and California is driving a national surge. Last week, Arizona had the highest per capita rate of increase in the country. Hospitalizations have hit record levels here, with more than two thirds of the ICU beds full. Banner Health Systems executives warned the state they’re bracing for another 25 to 50% increase in cases unless the state does more to slow the increase, like a statewide mask mandate, restrictions on large gatherings or other measures.

Last week, Arizona’s rate of infection increased 64%, hospitalizations increased 15% and deaths increased 15% — including a record average of 4,944 cases per day. So far the state has documented 653,000 cases and 10,876 deaths.

The federal government has not released county-level unemployment numbers for December or the first week in January, but Apache and Navajo counties likely remain well above the national or state averages, based on the November figures.

In November, the Arizona unemployment rate of 7.8 % compared to a national rate of 6.4%, according the University of Arizona’s web site tracking economic data.

At that time, Apache County’s unemployment rate stood at 12.6%, Navajo County at 9.5% and Gila County at 7.6 %.

Arizona in the past several months has gone from a rate just below the national average to well above the average as the pandemic has surged in the state.

In November, Arizona’s 7.8% rate compared to 10% in Nevada, 8.2% in California and 7.5% in New Mexico — all states also hard-hit by the pandemic in recent months.

Equally worrisome, the ranks of the long-term unemployed continues to rise and the percentage of working-age adults in the workforce has declined.

Fortunately, Congress has restarted the extra benefits for people impacted by the pandemic — including part time and self-employed workers.

Arizona has already started paying out the just-authorized $300 weekly in enhanced benefits — boosting the total maximum benefit to $540 weekly. The federal money will also provide the extra $300 a week beyond the normal maximum benefits period.

So far, the state has paid out $12.7 billion in extra jobless benefits through the original CARES Act and the follow-up measures enacted in December, just as the original program expired. Arizona was one of the first states to process the enhanced payments, although the state’s program has all been beset by fraudulent claims. State officials say people receiving benefits won’t miss any payments despite the last-minute approval of the new program by Congress.

Arizona has among the nation’s lowest maximum payments and shortest duration and does not normally cover part-time or self-employed workers. The federal CARES Act and the follow up package dramatically increased benefits. The most recent extension provides an extra $300 a month, half of the amount included in the original CARES Act.

The extended and enhanced benefits will continue through March 13.

President-Elect Joe Biden last week unveiled a fresh, $1.9 trillion economic stimulus package, which could help cushion the impact of growing unemployment.

The “American Rescue Plan” includes $400 billion for vaccine development and schools, $350 billion to help state and local governments cope with budget shortfalls, an addition $1,400 per taxpayer in direct benefits, subsidies for child care and more generous unemployment benefits.

The slow rollout of several approved COVID vaccines have heightened fears of renewed economic problems. The bulk of the population will likely not get vaccinated before late spring or early summer.

Prospects for passage of the American Recovery Act remain uncertain, although the Democrats will have narrow control of both the House and the Senate.

The federal budget deficit already stands at record levels. However, economists credit the first CARES Act package for cushioning the worst impacts of the pandemic, as well as the rapid recovery of half of the jobs lost in the initial surge of shutdowns and stay-at-home orders.

Peter Aleshire covers county government and other topics for the Independent. He is the former editor of the Payson Roundup. Reach him at paleshire@payson.com

(1) comment

Jordan

Better get a bigger chart, its gonna skyrocket in the next four years.

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