Personal Finance

In California, 57% seeking unemployment benefits lost their jobs for a second time

Key Points
  • About 57% of workers, or about 140,000 people, who filed for unemployment benefits in California recently had their jobs or hours cut for a second time. 
  • It's a drastic rise from earlier in the coronavirus pandemic and hints at the fickle nature of the country's economic recovery.
Men wait at dawn in order to be the first in line to enter a bookkeeping shop to fill out unemployment forms near the U.S.-Mexico border in Imperial County, which has been hard-hit by the COVID-19 pandemic, on July 24 in Calexico, California.
Photo by Mario Tama/Getty Images

Thousands of workers in California are turning to the state's unemployment system for a second time.

Indeed, more than half of people who recently applied for unemployment benefits in the Golden State had lost their jobs (or had their hours cut) again after having returned to work, according to an analysis published Thursday by the California Policy Lab.

It's a drastic rise from earlier in the coronavirus pandemic and hints at the fickle nature of the economic recovery across the country.

"It's become apparent that for the individuals who have been lucky enough to return to work, they're seeing that this new employment is especially unstable," said Till von Wachter, a co-author of the analysis and an economics professor at the University of California, Los Angeles.

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Unemployment still high

California is among the states that had to re-institute measures from earlier in the pandemic to shut down sectors of the economy in hopes of halting recent flare-ups of Covid-19.

Gov. Gavin Newsom ordered bars to close and restaurants to halt indoor dining in mid-July. Wineries, tasting rooms, movie theaters, zoos, family entertainment centers, museums and cardrooms also had to cease indoor operations statewide.

Officials in states like Texas, Arizona and Florida have reimposed some shutdown measures is recent weeks amid spikes in new coronavirus cases.

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Those closings threaten a gradual recovery in May and June that saw 7.5 million Americans return to work. The unemployment rate fell from a peak of 14.7% in April to 11.1% in June, still higher than any period since the Great Depression.

Indeed, unemployment applications nationwide remain elevated.

About 1.6 million Americans filed new applications for unemployment benefits last week, according to the Labor Department. (That combines the total from the traditional state system and the new federal Pandemic Unemployment Assistance program for self-employed, gig and other workers previously ineligible for state benefits.)

It was the 20th week that more than 1 million Americans filed new claims for benefits. That's still more than double the peak during the Great Recession, and comes at a time when an extra $600 weekly boost to unemployment checks lapsed at the end of July.

140,000 workers

In California, about 247,000 workers filed a new application for traditional state unemployment insurance in the week ended July 25, according to the California Policy Lab.

Most applicants — 57%, or around 140,000 workers — represented "additional claims," according to the Lab. That means they had received benefits earlier, returned to work and are now applying for benefits again because they lost a job or had their hours cut significantly (which may make them eligible for partial benefits).

The accommodation and food services, retail trade, and arts and entertainment fields — among the hardest-hit by the pandemic — make up a disproportionate share of "additional claims."

About a third of California's total workforce, or more than 6 million unique people, have applied for unemployment benefits since mid-March, according to the Lab.