Illinois’ new initial unemployment claims remain high

Illinois’ new initial unemployment claims remain high

New jobless claims remain several times higher than last year as state begins to test re-opening.

An additional 44,814 Illinoisans filed for unemployment the week ending June 6, bringing total new jobless claims to 1,244,942 since COVID-19 began shutting down the economy, new U.S. Department of Labor data shows.

The surge in claims during the initial closure of the state’s economy continues to slow, however new weekly unemployment claims continue to be several times greater than the same period last year.

With over 1.24 million Illinoisans filing unemployment claims since COVID-19 began affecting the economy, Illinois employed population declined by nearly 21%.

The spike in the state’s unemployment rate has increased racial and ethnic gaps in both health and labor market outcomes. Women, particularly black and Hispanic women, have been the most affected by job losses during the coronavirus pandemic and state-mandated lockdown. The primary reason for the sharper decline for these groups is that they tend to be employed in industries that were deemed “non-essential” by Gov. J.B. Pritzker’s stay-at-home order. It is now expected that it could take a decade to overcome the economic losses experienced during the past several months.

An index of coronavirus lockdown restrictions and Current Population Survey data show that states with the most restrictive lockdowns suffered the largest decline in employment.

Data from all 50 states show that states with the most restrictive lockdowns suffered the largest declines in employment. If Illinois leaders want to mitigate the losses, they must phase out the draconian lockdown measures more quickly. Lifting the lockdown will help to prevent mass business failures and permanent job losses. Illinois families cannot afford to be out of work for an extended period of time.

The evidence suggests that most small businesses have less than two months of cash on hand while the median small enterprise has more than $10,000 in monthly bills and less than one month of cash on hand. Illinois’ small businesses employ the majority of Illinois workers. Allowing businesses to open again is an important step to save lives and livelihoods.

Although lifting a lockdown will not restore economic activity to levels observed before the pandemic, research shows the sequential lift of a lockdown is the best way to mitigate both the human cost of the virus and the economic damage.

Further, Illinois voters need to consider the effects of the tax hike state leaders are seeking Nov. 3. Economists argue against increasing taxes during a recession. A progressive tax will increase taxes up to 47% on more than 100,000 small businesses just as they are trying to recover from the COVID-19 economic damage, and those small businesses are responsible for the vast majority of new jobs in Illinois.

A safe return to work for Illinois families is the first step to tackle growing racial gaps and to revive the Illinois economy. A tax increase would be a misstep.

After more than a century of protests erupting in Illinois and across the country, historians consistently peel back the triggers and factors to find economic injustice at the core. Ignoring the disproportionate costs of a pandemic and the pain in the streets by continuing the same, failed policies is to welcome further human suffering.

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