April 24, 2020
In the week ending April 18, initial claims for unemployment insurance nationwide totaled 4,427,000. Over the past five weeks, 26.5 million workers in the United States have filed claims. This represents 16 percent of employment (in February, prior to the recent claims surge).
Michigan began processing claims this past Monday, April 20, from the self-employed, including “gig” workers. Over the last five weeks, Michigan has seen a total of 1.1 million initial claims—25 percent of its February employment level and one of the highest shares of any state.
Forty-six states have initial claims over the last five weeks that are least 10 percent of employment. Of these, 24 states exceed 15 percent, and eight states are over 20 percent. Seven states have cumulative filings over 1 million: California (3.3 million), Pennsylvania (1.5 million), New York (1.4 million), Texas (1.3 million), Michigan (1.2 million), Florida (1.2 million), and Georgia (1.1 million).
Michigan Perspective on Construction
In Michigan, initial filings for the week ending April 18 totaled 134,119, a decrease from 222,207 the week before.
Governor Whitmer’s March 23 stay at home order—extended on April 9—allowing only on-site work for essential workers and critical infrastructure activities has affected every industry. Construction has been especially hard hit, where half of workers have filed for benefits since mid-March.
Conversations with industry leaders note that construction projects for hospitals and repairs of highways and bridges have continued, but nearly all others have been stilled. The latter include K-12 education buildings, private business offices, and residential construction.
The Chief Operations Officer at the CSM Group reported to us that extensive planning has been implemented for continuing construction projects to ensure social distancing and proper protection of workers needing to work in close quarters. The use of staggered scheduling and off-cycle work shifts is now becoming the new norm. Work that can be is done remotely. Even so, construction managers report increasing difficulty hiring self-employed specialty trade contractors, many of whom are choosing to limit work-exposure risk.
For the future, protocols are already being developed to create a safe return whenever business is opened up. Companies report plans to conduct two to three-day orientations and soft starts before ramping up to normal levels. This is likely true across all industries as firms figure out what will be the new normal at work.
Other Michigan Industries
In manufacturing, 1 in 3 employees has filed in the last five weeks. Four auto-related industries—transportation equipment, fabricated metals, machinery equipment, and plastics and rubber—have accounted for 70 percent of initial claims in manufacturing.
Retail trade has seen 120,000 cumulative filings—10 percent of total claims, and 26 percent of its employment (see table).
As we have reported in recent weeks, healthcare is not immune, with over 108,000 filings in the last five weeks, 65,000 of which are from doctor’s and dentist’s offices, outpatient care centers, labs, and home health care. The 20,000 claims from hospitals reflects cutbacks in elective care and surgeries, although there are some signs that this may be easing.
Food services and drinking places, which led the first-week surge with one-third of all filings, has now reported a five-week total of 126,000, nearly 40 percent of workers in the industry.
Across Michigan counties, four account for half of the cumulative initial filings since March 15: Wayne (19 percent), Oakland (12 percent), Macomb (12 percent), and Kent (7 percent). These four counties account for over 61 percent of employment in transportation equipment manufacturing in the hard-hit auto industry. Although construction has experienced a nearly 50 percent reduction in employment due to layoffs, employment in this industry is not as concentrated as autos—rural counties, especially in the Upper Peninsula, tend to have higher shares of employment in construction. The diffusion of employment across counties is even greater in retail and food and drinking places (see map and table below).