Workers furloughed in the spring are seeing their temporary layoff status become permanent as the coronavirus pandemic deepens across the United States.
In April, roughly 2 in 10 households experiencing job loss considered their layoff permanent, while the remaining majority believed they would return to their former jobs within a few months. Now, as states have stalled or reversed reopening plans and the coronavirus outbreak worsens, nearly half of unemployed workers believe their jobs are not coming back, according to a poll from The Associated Press-NORC Center for Public Affairs Research.
Katherine Williams of Waterford, Connecticut, worried her job as a fulfillment lead for Macy's wouldn't be restored when she was furloughed in April. Her fears were confirmed in late June when she received a call that her assistant-manager-level position was eliminated.
"I had a gut feeling it was going to happen," Williams, 40, tells CNBC Make It. In February, prior to the threat of the pandemic, her store was identified as one of the 125 Macy's locations scheduled to close in the next three years. The department store chain began reopening some locations in May, and Williams noticed she wasn't called back even after her own store reopened.
At one point, before she was officially laid off, Williams recalls stopping by the store to pick up some items for her family, when she saw some of the associates who used to report to her were back at work.
"It was quite a kick in the face," Williams says. "I had left a good job to help the [Macy's] store manager who wanted me there, and now I can't go back to my other job." About a year ago, Williams left her steady job as a public school-bus driver to work for the retailer. Because she was gone for the past school year, Williams says it's unlikely she can go back to her old position now. Not to mention, it's unclear how schools and buses will operate when the district plans to begin the year on August 31.
In a statement provided to CNBC Make It, a Macy's spokesperson said, "In July, we welcomed back nearly all of Macy's, Inc. furloughed colleagues."
With the $600 weekly benefit gone, workers scramble to recalculate budgets and continue job search
Macy's began closing stores in mid-March and furloughed the majority of its retail employees by April. The company said CEO Jeff Gennette would not receive compensation starting April 1 until the end of the crisis, and executives at management director level and above would get pay cuts.
By late June, Macy's announced plans to cut 3,900 corporate jobs, or 3% of its workforce, to save about $365 million through fiscal 2020. Shortly after, Gennette received restricted stock worth $3.7 million on July 9, according to filings with the Securities and Exchange Commission. Five other executives received awards ranging from $350,000 to $3 million, the filings said.
Former Macy's employees like Williams, meanwhile, are left to weather a worsening pandemic and recession through unemployment benefits, which dropped dramatically as the $600 weekly enhancement from the federal CARES Act expired July 31. Williams says she's thankful her husband is an essential employee and is still working as a tow truck driver for an oil company. But without boosted unemployment going forward, the couple will have to more carefully budget for themselves and their four children for the foreseeable future.
Williams adds that her husband is currently on paid leave, as his company had to temporarily shut down after another driver recently tested positive for the coronavirus.
While Williams's husband tested negative for the virus himself, his employer's emergency shutdown is another reminder that the health threat of the pandemic remains high. Williams's youngest son has a preexisting condition that puts him at high risk of contracting the virus.
"My son being high risk — that means I'm high risk, and my husband is high risk," Williams explains. "We have to be careful about where we take jobs." Williams says she has applied for a number of jobs, from warehousing to online customer service positions, but is often told she's overqualified, or that the company is more focused on rehiring workers than bringing in new employees. In the meantime, she continues to pursue job leads, and is also working with a friend to design and sell custom signs for a little extra money on the side.
"Besides going stir crazy, we're doing OK," Williams says.
Returned workers wonder how long their callback will last
In Miami, Florida, Andres Balzan was both relieved and concerned when he received the call from Macy's that he'd be back to work in July.
Balzan, 30, was furloughed from his job as a merchandise support worker in April and was nearing the end of his 12-week unemployment period administered by the state of Florida, which has one of the shortest benefit windows in the country. Knowing the $600 weekly benefit was coming to an end in July, and unsure of how to file for a 13-week extension under the CARES Act, Balzan says his call back to work "came right on time."
"I've been lucky in that regard," he tells CNBC Make It, noting that he's glad to be back at work full time at 40 hours per week, and that he isn't underemployed. "I've heard there are still 40 to 50 people still waiting to be called back [at my location]."
"I don't know what I would be doing if I was still unemployed," he adds. "It's really a benefit to go back to work. I'm not making as much as I was not working, but that wasn't the point of unemployment [benefits] — the point was to stay at home during the pandemic."
Balzan says he was part of his location's third round of callbacks and consulted with colleagues about how to stay safe at work, though he's continuously concerned about navigating the virus in his store. Florida is among the handful of states that have seen a surge in coronavirus cases in recent weeks.
"My first day back to work I felt scared. I was really watching myself," Balzan says. "But as time has gone on, I'm getting more comfortable." Because his store is spread across three stories within a Miami mall, he is able to avoid crowds and is diligent about practicing social distancing, washing his hands and not touching his face.
He does worry how long his position will last as the city navigates health and economic recovery during the pandemic.
"I am worried if we go into lockdown again that the store won't open back up," says Balzan, who is also studying full-time to earn an IT degree. "It could also close again, reopen and I don't get called back. Those are two things on my mind."
Millions wait to get called back to work
Still, millions of other out-of-work Americans find themselves in limbo wondering when, or if, they'll be called back to their previous job while the economy continues to free-fall. Roughly 1.4 million Americans filed new unemployment claims in the last week, the second week of rising claims after a period of trending downward.
"Everything is up in the air," says Sunny Dreyer, 32, who was furloughed from her job at a Casper retail store in April. She tells CNBC Make It that the last email she received from the company was that her health coverage would be extended into August, but says her boss has become unresponsive to texts for further updates about store opening plans. Right before the pandemic caused Casper to close retail locations in March, Dreyer was in the process of moving from her Los Angeles-based store to help launch a new one in Orange County.
A spokesperson for Casper tells CNBC Make It that the company has reopened 59 of its 61 retail stores and is continuing to open new locations, most recently in Las Vegas and Orlando, Florida, with new protocols such as virtual appointments, private shopping and curbside pickup.
With the federal boost on top of her California unemployment, Dreyer says her benefit just about fully recovers her old wages. Planning for its expiration, however, has been "trying," she says. "If they do shrink [enhanced unemployment] to $200 per week, it would be feasible to make it work, but it's so much easier when you have $600 a week extra to plan for emergencies, or even just groceries."
Her fiance's income as an on-demand gig driver has also taken a hit with the pandemic. California's confirmed coronavirus cases recently crossed the 500,000 mark, though after weeks of rising cases, the Los Angeles Times reports that hospitalizations in L.A. and Orange counties have dropped over the last week.
Dreyer estimates they have about six months of living expenses in savings, and she's thankful to have family nearby who can help in case of emergency. But with the enhanced unemployment benefit gone, her ongoing job search has taken on new urgency. So far, she's had little luck despite casting a wide net applying for online assistant and communications roles, and anything that can make use of her background in museum development and fundraising.
"Obviously that work isn't really happening," Dreyer says, "so I'm trying to figure out what's feasible to do right now. Maybe I'll figure out way to pivot myself into an entry-level role in something I wouldn't think to do long-term but would keep my head above water.
"We'll do the best we can to stay safe and healthy," Dreyer continues. "That's all we can do at this point. We just have to bite the bullet and deal with what we can."
The House of Representatives in May passed the HEROES Act extending the $600 weekly unemployment until 2021, though the Senate did not take up the proposal. The upper-chamber released its own HEALS Act last week that extends benefits to $200 per week until October, followed by a 70% wage replacement calculation until the end of the year.
Congress did not come to an agreement Friday on the next round of pandemic relief, likely to be the last package before the November 2020 presidential election. Negotiations are ongoing.
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