Kentucky, Idaho Top List of Fastest Unemployment Recovering
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In the context of U.S. adding 4.8 million jobs last month and the unemployment rate at about 11 percent, which compares to 14.7 percent at the peak of the coronavirus pandemic, WalletHub released a list of the “States Whose Unemployment Rates Are Bouncing Back Most.”
The methodology involved comparing the 50 states and the District of Columbia based on four metrics. “We looked at the change in each state’s unemployment rate during the latest month for which we have data [June 2020] compared to June 2019 and January 2020,” the company said. “We also compared not seasonally adjusted continued claims in June 2020 to June 2019. Finally, we considered each state’s overall unemployment rate.”
The top three states “bouncing back” the most are Kentucky, Idaho and Utah while Massachusetts, New Jersey and Hawaii were the slowest to recover. Here, Jill Gonzalez, WalletHub analyst, discusses the findings as well as offers insights into travel trends and restrictions.
WWD: Which state experienced the biggest increase in unemployment as compared to the beginning of the year?
Jill Gonzalez: Massachusetts has experienced the biggest increase in unemployment because the number of unemployed persons jumped by 405 percent from January 2020 to June, compared to the average increase of 155 percent. Massachusetts’ overall unemployment rate is 17.5 percent, compared to the [national] average of 11.1 percent.
WWD: Do you expect states to impose restrictions again?
J.G.: States are more likely to pause their reopening processes than they are to close down again. We will probably see lockdowns only applied locally in areas that are the hardest hit. Lockdowns won’t have any quick benefits unless we restrict the flow of people in and out of highly affected areas, which is why some people may conclude that lockdowns are ineffective as a whole.
WWD: How do you think a decrease in summer travel will affect unemployment?
J.G.: A decrease in summer travel due to COVID-19 will keep the rate of unemployment in the travel and tourism industries high compared to other sectors, as they will receive a much smaller inflow of cash than normal and consequently will have reduced hiring power until we proceed to a full reopening.
Reduced summer travel could be a good thing for local merchants in places that aren’t tourist hubs, as people’s “staycations” could inject more money into the local economy and help businesses hire more, or at least stay afloat. Cities that are popular vacation destinations will get less traffic from outsiders but may see more visits to attractions from locals who know there will be fewer tourists.
WWD: What can states do to support the unemployed, other than provide traditional benefits?
J.G.: Aside from financial assistance, the best way for states to support unemployed residents is to facilitate a safe reopening that allows businesses to start rehiring. States should prioritize reopening places that help unemployed people get back to work, such as libraries with free Wi-Fi where they can conduct job searches and childcare programs that allow parents to go to work.
Safety should be the number-one concern in any state’s reopening process, so a big part of getting people back to work is requiring face masks in public and other restrictive measures to prevent a resurgence of COVID-19.
States That Have Bounced Back Most
1. Kentucky
2. Idaho
3. Utah
4. Montana
5. Maine
6. Oklahoma
7. Wyoming
8. North Dakota
9. Missouri
10. Nebraska
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