Louisiana Unemployment Echoes Nationwide Decline: Are Things Really Better?

Symone Graham, Claire Lyon and Nicole Mistretta

@symonegraham_

@clairelyon_

@MistrettaNicole

Feature photo: Photo by Nicole.

Nine weeks into Phase 3, unemployment numbers in Louisiana remain above the pre-pandemic normal.

The decline in unemployment and move from a statewide shutdown to Phase 3 showed an improvement since the beginning of the COVID-19 pandemic. A local university professor explained why the drop over the last 5 months does not necessarily mean things are going back to normal.

Is Unemployment in Louisiana Really Getting Better?

Unemployment rates in Louisiana dropped 44% from April to September 2020. 

However, University of Louisiana at Lafayette Professor Stephen R. Barnes, Ph.D. said the rapid decline in unemployment since the peak in April is due to the expiration of eligibility for unemployment benefit claims.

In Louisiana, people who have lost their jobs can claim benefits for up to 26 weeks in the regular program, according to Barnes. He said the people who sought benefits since the beginning of the pandemic are “timing out” the program and have exhausted their benefits. Those people will no longer appear in the data, collected by the Louisiana Workforce Commission (LWC) and the U.S. Bureau of Labor Statistics, because they are no longer able to collect benefits, according to Barnes.

Barnes said while initial claims have fallen since the beginning of the pandemic, they remain above pre-pandemic norm. Initial claims show how many new people began applying for benefits and continued claims are the number of people still on unemployment.

“So that tells us there’s still an elevated level of people losing jobs today which is bad news for the economy and really reflects more lasting permanent damage because the length of this slow down has really started to translate into more permanent job losses,” Barnes said.

Though unemployment claims dropped since April 2020, in September, Louisiana saw its first unemployment rise.. Dede Dunham, press secretary at the LWC said the September increase is attributed to Hurricane Laura’s impact on the Lake Charles region. She said other areas in the state continued to see a decline from August.

Barnes said if the state had to shut down for a few days during the storm, the collection and processing of claims may have been pushed back, contributing to the spike in September. 

Finding Work in a Pandemic

Michael Zaunbrecher, franchise co-owner at the Spherion Staffing Company in Lafayette, said while there are more jobs available, it is “not as good” as before the pandemic. He said the end of the year is typically a slower time of year for the staffing company. By Spring 2021, Zaunbrecher said they hope to know whether things are starting to improve.

Zaunbrecher said finding jobs for people during COVID-19 was difficult and people seeking staffing services were “very few and far between.” He attributed the low number of job seekers to the unemployment benefits distributed.

“It was even to the point where we would call people already in our database for work and they would turn us down because they were making more or very close to the amount of money off the unemployment [benefits]…,” Zaunbrecher said.

If someone refused to pursue a job opportunity provided by Spherion Staffing Company, Zaunbrecher said they reported them to the workforce commission. He said he could not confirm if the LWC cut off benefits at that point.

“Now that [the unemployment benefit] is not what it was, we are seeing an increase in people coming in looking for work,” Zaunbrecher said.

Dunham said the mining and logging industries have shown a decline in employment opportunities over the last several years due to the low price of oil. Zaunbrecher said his company has trouble placing people in the oil and gas industry which he believed was a struggling industry before the pandemic.

Zaunbrecher said Spherion found more jobs in the healthcare industry throughout COVID-19. Steven O’Bryan, owner of Bon Temps Grill, said the restaurant industry is always looking for more people as they “always have workers coming and going.”

Effect on Local Business

Bon Temps Grill reopened at a new location on Nov. 16 and O’Bryan said his staff is back to “full strength” since the pandemic.

“It’s obviously tough, but people are still making a choice to eat whether it’s taking it home or not. For us, we’re definitely down from last year with 75% occupancy. We’re still doing good, but obviously not as good as we could if there was no COVID, but we’re one of the groups that are still growing during this time,” O’Bryan said.

O’Bryan said he is concerned about potentially moving back to Phase 1 or 2 because the restaurant industry and small businesses “can’t handle going backwards in COVID.”

According to Barnes, some industries have found ways to operate during the pandemic and carry on through remote work. O’Bryan said the restaurant industry depends on regular operations to survive.

“Restaurants are not built to be run on 50% occupancy or less, the business models for those places are typically expensive. The operating costs are very high, and the margins of profit are very slim, so if you miss a couple months, that means you lose money for the whole year easily,” O’Bryan said.

O’Bryan said some restaurants have not been able to reopen, but he thinks those who have reopened and follow Center for Disease Control (CDC) guidelines are doing well.

Barnes said companies who adopted new technologies and processes allowed the economy to get back to work. He said the country is better suited to continue working if there is another big, or even potentially worse, spike in the number of cases.

“By the time we get to September we’ve recovered a lot of the jobs that were lost, spending has come back in a big way, but I think our ability to continue to close the gap and get all the way back to a full recovery is stuck and kind of waiting for a permanent solution to this virus,” Barnes said. 

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