Recent news analyses have sketched out a dire picture of the scope of the jobless crisis in Louisiana and the extent of the expected damage that the state’s economy as the federal boost to unemployment benefits lapses.
But the true picture is actually worse than some of those reports have outlined. For instance, a Sunday story in The Times-Picayune | The New Orleans Advocate noted that more than 313,000 laid-off Louisianans had filed for state unemployment benefits as of July 18, the most recent data for which the state provided complete data. But that figure didn’t include the thousands of freelancers, independent contractors and so-called “gig” workers thrown out of jobs by the coronavirus crisis.
That latter group includes more than 152,000 out-of-work Louisianans who, although not normally covered by the unemployment insurance system, have been able to file for jobless benefits under a special federal expansion of the program to address the massive job losses during the pandemic.
A major lifeline of federal aid to more than 300,000 laid-off Louisianans during the coronavirus crisis, the extra $600 federal boost to every…
Added together, that works out to about 465,000 out-of-work Louisianans — or nearly a quarter of the state’s total labor force — who have filed continued claims for unemployment benefits. All are now in line for a $600-per-week cut in income after the federal boost to unemployment, passed by Congress in March, expired at the end of last week. For most of those people, that will be a loss of at least 70% of their income.
The now-expired $600 federal boost to benefits injected a total of as much as $270 million each week into the Louisiana economy.
“It’s an enormous income loss that has started now,” said Jan Moller, executive director of the Louisiana Budget Project, a left-leaning nonprofit that advocates for working Louisiana families. “There are not half a million jobs for people to go back to. Not even remotely close.”
While the data suggest nearly 1 in 4 working Louisianans is about to take a major financial hit, that pain won’t be spread evenly on a geographic basis. A March analysis by the Brookings Institution predicted that New Orleans would be the third-hardest hit of 106 large U.S. metro areas, thanks largely to the city’s dependence on tourism.
As predicted, the pandemic prompted a freefall in air travel, led to the cancellation of numerous major festivals and conventions, and forced bars, restaurants and hotels — the biggest employers in the area by far — to dramatically scale back operations or shutter entirely.
Later this week, hundreds of thousands of Louisianans who lost their jobs in the pandemic will see their unemployment benefit checks slashed b…
As of June, the latest figures available, the number of total jobs in the New Orleans area was down 13.7% from February levels. Those numbers were down across the state, of course: the drop was 10.5% in the Baton Rouge area and 5.4% in Lafayette, according to the federal Bureau of Labor Statistics. The picture appears to have only worsened since then, at least based on weekly initial unemployment claims, which after falling in May and June began ticking back upward throughout July.
Claims from Orleans, Jefferson and St. Tammany account for nearly a third of the state’s total unemployment claims.
Businesses that cater to travelers now face a deeply uncertain future. The coronavirus’ resurgence has cast doubt over the future of the tourism industry, and a growing number of major employers in that sector — casinos and large hotels — have filed notices with the state warning of mass layoffs, an indication that mass furloughs in March and April are likely to turn into permanent job cuts. The accommodation and food service sectors have seen by far the steepest job losses, both statewide and in the New Orleans area, followed by retail.
“Those two sectors alone count for more than 50% of the job losses that we’ve seen in the last couple of months,” said Gary Wagner, an economics professor at the University of Louisiana Lafayette, during the Acadiana Advocate’s virtual economic outlook panel Wednesday morning.
Workers in the hospitality industry in particular tend to earn lower wages, live paycheck to paycheck, leaving many out-of-work families with little cushion to ride out unemployment. While some in this sector actually got a brief boost in pay from the $600 weekly unemployment supplement, they’re unlikely to have much in the way of savings to draw on when that stipend is cut.
“It’s going to have a generational impact on a lot of households,” said Moller.
Hundreds of thousands of Louisianans who’ve lost their jobs during the coronavirus pandemic have continued to receive sizable weekly checks, t…