It is encouraging that more Vermonters are getting back to work. For now.
The Vermont Department of Labor recently released data on the state’s economy for the time period covering July 2020. The seasonally-adjusted statewide unemployment rate for July was 8.3% — a decrease of one and two-tenths percentage points from the prior month’s revised estimate of 9.5%. The comparable United States rate in July was 10.2%, a decrease of nine-tenths percentage points from the revised June estimate.
The July data reflects continued improvements in the number of unemployed and the number of filled jobs in Vermont, according to Michael Harrington, labor commissioner. The number of unemployed people is a little more than half of its April peak, but the economic impacts of COVID-19 are still readily apparent.
And they are very apparent.
The U.S. Labor Department this week reported that the number of Americans applying for unemployment benefits fell last week to 860,000, a historically high number of people that illustrates the broad economic damage still taking place nine months after the first case of COVID-19 was detected in the United States.
The Labor Department said Thursday that U.S. jobless claims fell by 33,000 form the previous week and that 12.6 million are collecting traditional unemployment benefits, compared with just 1.7 million a year ago.
There is no question, the pandemic has delivered a colossal shock to the economy. Until the pandemic upended the operations of American companies, from factories to family diners, weekly jobless aid applications had never exceeded 700,000 in the U.S. They’ve topped 700,000 for 26 consecutive weeks, according to Labor Department data.
The overall economy, as measured by the gross domestic product, collapsed at an annual rate of 31.7% from April through June, by far the worst three months on record, as millions of jobs disappeared.
The economy and job market have recovered somewhat from the initial shock. Employers added 10.6 million jobs from May through August, but that’s still less than half the jobs lost in March and April.
The recovery remains fragile, imperiled by continuing COVID-19 infections as schools begin to reopen, and the failure to deliver another economic rescue package in Washington. And companies continue to lay off workers as they absorb sales lost to the pandemic.
Our neighbors here in Vermont can attest the times are hard.
An extra $600 in weekly unemployment benefits ran out July 31, squeezing households that had depended on the beefed-up payments. President Donald Trump issued an executive order Aug. 8 providing a scaled-back version of the expanded jobless aid. Most states signed up for federal grants that let them increase weekly benefits by $300 or $400. That program is expiring.
Last week, nearly 659,000 people applied for jobless aid under a new program that extends eligibility for the first time to self-employed and gig workers, down from 868,000 the previous week.
As we have reported on these pages, businesses are closing. Most recently, the Thomas Dairy announced it would close in early October. For communities where longstanding businesses fold it is breathtaking every time.
COVID’s toll continues to mount. Small businesses, particularly in restaurants and retail, continue to close their doors and lay off workers, according to consumer review site Yelp. The number of small companies that have temporarily or permanently shut down has increased since mid-July, Yelp said Wednesday, to more than 160,000, reversing a steady decline from the spring.
And permanent closures are still rising, Yelp said, with nearly 100,000 businesses closed for good as of the end of August.
“It’s not a pretty picture,” said Beth Ann Bovino, chief U.S. economist at S&P Global told The New York Times this week. “We’ve got a long way to go, and there’s still a risk of a double-dip recession.”
While we can feel some relief in the progress that is being made to get Vermonters (and Americans) back to work, we need to be mindful about what is going to happen next.
First, the national election is going to make Americans even more tentative about consuming. And the weather is going to change, forcing us back indoors for long stretches of time. The fall and winter could be a challenge for many businesses. We need to do our part to shop locally, keep the support flowing and practice the health guidelines that allow the economy to move forward, albeit it slowly.
This is no longer a singular problem for person or family. It is incumbent on us to keep our Main Streets and communities in mind.