With unemployment claims above 26 million, reports have surfaced that state UI systems cannot handle the volume of applications, leaving millions of laid-off and furloughed workers unable to receive unemployment benefits.
In light of such underrepresentation in the official unemployment numbers, The Economic Policy Institute (ERI) conducted a study that revealed millions more might have filed for unemployment, if not for the difficulties during the process.
According to the survey, a potential 8.9-13.9 million additional people would have filed for benefits, but they found the process too difficult. The higher end of that puts unemployment at 8.25%, nearly about the current official statistic of 4.4%. The survey estimates about half of the potential UI applications were approved for benefits.
The online survey, which was released on Tuesday, shows that for every 10 people who have successfully field for unemployment benefits, three were not able to complete the process, and two more decided not to try because the process was “too difficult.”
“These findings imply the official count of unemployment insurance claims likely drastically understates the extent of employment reductions and the need for economic relief during the coronavirus crisis,” according to the authors, whose findings include the five weeks of claims since March 15.
The poll, which was conducted between April 13-24, included 25,000 US adult internet users. More than 68 percent of the participants did not apply for unemployment, as they had managed to keep their jobs. More than 15 percent were ineligible for benefits. 1.6% of applicants were rejected. EPI said that some states may have been ill-equipped to process applicants with expanded eligibility.
EPI used Google Surveys, which collects responses from visitors to news and other internet sites, to ask 25,000 people: “Did you apply for unemployment benefits in the last 4 weeks?” (Google Surveys collects responses from visitors to news and other internet sites.
“You’re looking at something like minus 20% to minus 30% [GDP] in the second quarter,” said Kevin Hassett, an economic advisor to Kevin Hassett, told CNBC on Monday. Hassett anticipates unemployment to reach 16-17%. It’s not the worst case scenario, either.
“Around 2008, we lost 8.7 million jobs,” he said. “Right now, we’re losing that many jobs about every 10 days.”