Baldwin County had the third-largest increase in unemployment claims statewide between March 21 and April 11, according to data from the Alabama Department of Labor (ADOL), but it ranks 16th of the 67 counties for the percentage of its labor force seeking unemployment benefits during the COVD-19 pandemic.
On Thursday, the ADOL reported another 77,515 initial unemployment claims were filed the week of April 5-11, bringing the total number of claims filed during the COVID-19 pandemic to 277,607. Comparatively, the week ending March 14 saw just 1,824 claims filed in all 67 counties, indicating a statewide increase of more than 15,000 percent in the weeks since.
But on Friday, the department announced a preliminary, seasonally adjusted March unemployment rate of only 3.5 percent, which is up from February’s record low level of 2.7 percent. According to a related news release, the data does not yet reflect the impact of the COVID-19 pandemic, as the March unemployment rate was measured during the week of March 12.
April’s unemployment rate, scheduled to be published on May 22, will more accurately reflect the impact of the pandemic on Alabama’s economy, the department reported.
On Monday, Alabama Labor Secretary Fitzgerald Washington announced the department had disbursed more than $164 million in COVID-19 related unemployment compensation benefits to 103,453 claimants between March 16 – April 18. But more than 80 percent of those funds — or $132.3 million — are Federal Pandemic Unemployment Compensation (FPUC), the $600 stimulus benefit added to weekly unemployment compensation benefits.
At a press conference with Gov. Kay Ivey Tuesday, Washington elaborated on the numbers, reporting more than 307,000 people had filed for unemployment benefits since mid-March, compared to just 130,000 in all of 2019.
“In the last two weeks it looks like those filings have trended downward, it looks like we’ve hit our peak from where it was three weeks ago,” Fitzgerald said, acknowledging the department has had problems processing such a large amount of claims in a timely manner. “I know that there’s a lot of tension out there, there’s a lot of frustration from people that have been having some difficulty in trying to file the claims. Forty percent of the people that have filed claims have been paid. Our agency is not going to be relaxed or satisfied until we satisfy, making sure the other 60 percent get their payment.”
In a follow-up email with the department about the most recent numbers, Communications Director Tara Hutchinson reported that of the 307,000 claimants who have filed for benefits, 145,000 have actually received benefits. Only about 1,000 claimants were denied benefits, mostly due to fraud from a previous claim or a failure to provide requested information.
The remaining 162,000 claimants have not received their payments yet for one or more reasons including:
• 59,000 claimants have not yet filed their weekly certification.
• 105,000 claimants have an issue on their claim that is preventing payment.
“The biggest issue is a Lack of Work issue that is caused by the law requiring the department to give employers 10 days to dispute the cause of the employee’s separation,” Hutchinson wrote. “Most of the time employers have not been disputing the separation, but the law requires we give them due process.”
• 106,000 claimants have not been paid yet because the department just started paying under the PUA program for self-employed, non-profit employees and gig economy workers.
“We have started paying these PUA claims now, and this number is improving,” Hutchison wrote. “Currently the biggest challenge the department faces is that we are having difficulty receiving and processing these claimants’ income documents. We are working hard to streamline this process.”
Under the CARES Act, anyone receiving unemployment compensation benefits from the state is eligible for the additional $600 a week stimulus payment, which is added to the recipient’s state weekly benefit amount. Alabama pays a maximum of $275 per week for each claim for up to 14 weeks, but the CARES Act also provided up to 13 weeks of additional funding for states to extend those benefits.
While many potential claimants have also expressed frustration about not being able to check the status of their claims, the department has adjusted to the volume by reassigning dozens of staff members to answer phones, releasing an online claims tracker so applicants can monitor their status independently and mobilized a new call center in partnership with a third-party contractor.
On Monday, Washington asked claimants to remain patient as “it can take up to 21 business days to process a claim, and with the added record-setting volume, it may take longer in some cases.”
HOW UNEMPLOYMENT IS CALCULATED
Alabama’s unemployment rate is compiled by the U.S. Census Bureau through a telephone survey, which is then verified by the federal Bureau of Labor Statistics (BLS). The Census process simply cold-calls citizens around the state, asks if they are working, and if not, asks if they want to work.
The BLS unemployment rate is calculated by dividing the number of unemployed individuals by the number of individuals in the civilian labor force (or the sum of those working or looking for work). The rate is often preliminary until it can be adjusted for seasonal changes, but is finalized in an annual report.
The ADOL has long maintained weekly records of initial filings, but the data has primarily been used internally to keep track of the number of people losing their jobs and the amount of money that may need to be paid out of the state Unemployment Compensation Trust Fund. As of Friday, the balance in the fund was $635 million, Hutchinson said.
A closer look at the weekly claims numbers indicates Baldwin County has been hit particularly hard. In fact, the preliminary data suggests that through April 11, 15.29 percent of Baldwin County’s labor force had filed for unemployment. Comparatively, Hale County leads the state with 22.61 percent of its workforce filing unemployment claims, while Shelby County ranks last with just 5.21 percent.
Mobile County has had the second-highest number of claims since March 14 — or 24,302 people — it ranks 19th in the percentage of the workforce who have filed at 13.04 percent. Jefferson County has had almost twice as many claims and has the most in the state, but it ranks 21st in the percentage of workforce.
According to the Tax Foundation, the national average for percentage of the civilian workforce filing for unemployment benefits is 10.6 percent, while the state of Alabama ranks 44th with its statewide average of 6.4 percent.
If combined, Baldwin and Mobile counties would still fall short of Jefferson County for the total number of claims filed, but Lee Lawson, president and CEO of the Baldwin County Economic Development Alliance, believes it may be the most negatively impacted metro area in the state.
“From a percentage standpoint we’re not leading the state but if you look at the counties ahead of us, they all have smaller workforces than we do in smaller populations,” he said. “But between our regional economy, if you just look at [Baldwin] and Mobile together, our workforce is very transient between the two counties. Then there were headlines this morning that there’s several thousand unemployment claims held up in the system at the Department of Labor. And
that’s concerning and the concern is how many of those thousands that haven’t gotten through or filed or are [our employees]?”
Lawson said as a member of Congressman Bradley Byrne’s task force on reopening the economy, he’s learned the majority of Baldwin County businesses were eager to reopen even with restrictions, but the long-term economic impact of the closures on the county’s finances are all dependent on timing.
“If we’re going to capitalize on the summer from a tourism perspective we’ve got to get our beaches back open and have at least the month of May to get everything in order,” he said. “Hopefully, we can show the visitors and the public that they can safely visit our community and enjoy the tourism season, which is not only vitally important for Baldwin County but also all for all the municipalities in the county.”
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