This week, Washington state is confronting one of the biggest economic disruptions since the start of the pandemic.
With the recent expiration of two massive pandemic unemployment programs, federal benefit payments are going out to nearly 140,000 jobless Washingtonians who aren't covered by regular state unemployment. A third federal pandemic program, which added $300 weekly payments to federal and state unemployment benefits, has also expired.
Collectively, unemployed Washingtonians are receiving what amounts to a $133 million final installment on nearly $16 billion in federal pandemic assistance sent to the state since March 2020, according to the state Employment Security Department (ESD) which administers the federal programs.
Although a small number of pandemic assistance claims will continue to be filed and paid in coming weeks, ESD officials say the programs are effectively over — and that's provoking a mixed response.
Many short-staffed employers hope it prompts a wave of job applicants and helps solve a crippling labor shortage — a hope that, to be fair, isn't well supported by data from states that ended federal pandemic assistance earlier this year.
Many unemployed workers, on the other hand, have different concerns. Although some of the 137,811 Washingtonians who were receiving federal pandemic benefits can switch to the state's regular unemployment program (which is currently receiving upward of 50,000 weekly claims, as of Sept. 4), most federal claimants are out of luck. While some in Congress want to extend the federal benefits or replace them with state funds, few policy experts see much chance of that.
As a result, according to ESD estimates, more than 120,000 people — around 3% of Washington's labor force — will lose a weekly benefit that for many was their sole financial support.
"If I wasn't married, I'd be downsizing and getting ready to live out of my 16-year-old vehicle," said Andi O'Rourke, 32, a Bainbridge Island resident who said she has received federal benefits since suspending her landscaping business last year due to the pandemic and also has struggled with the lingering effects of COVID-19.
The federal programs "were a lifeline," added Richard, a Seattle-area resident who lost his marketing job in June 2020 and hasn't found work since then in part because of health problems. (Like several people interviewed for this story, Richard asked not to be fully identified so as not to jeopardize his job prospects.) With the end of benefits, "I have $0 income," he said. "It's going to be challenging."
The full effects of this pandemic benefits "cliff," as some call it, won't be known for some time. In coming months, economists and policymakers will be closely watching for increases in hiring but also for indicators such as rising applications for food assistance and increased evictions. (The state's eviction moratorium ends Sept. 30).
"There could likely be stress on other parts of the social safety net, now that this part of the social safety net is going away," said Anneliese Vance-Sherman, an ESD regional economist who covers the Seattle area.
In fact, we already know a lot about the individuals going over the benefits cliff, thanks to claims data collected by ESD as well as stories that claimants have shared with The Seattle Times.
Both make clear the kinds of workers who were hit hardest by a recession unlike any in recent memory — and who may continue to struggle now that the pandemic has outlasted government programs intended to soften its economic effects.
Who was claiming benefits?
Federal assistance targeted two broad categories of pandemic-related unemployment that weren't covered by regular unemployment programs.
Pandemic Unemployment Assistance paid affected workers who ordinarily don't qualify for regular unemployment — among them, contractors, the self-employed, part-timers and workers who had their hours cut.
Of the 59,583 Washingtonians who filed a PUA claim last week, the largest job categories included janitors and other building cleaners (which represented about 6.4% of all claims); construction workers (5.8%); child care, fitness instructors and other personal care workers (5.3%); and taxi drivers, bus drivers and other motor vehicle operators (5.1%).
The self-employed were often especially hard-hit in the pandemic.
Barbara Wright, a Seattle copy editor, was doing 40 hours or more of editing a week when the pandemic forced her clients to cut back drastically. "I lost all of them within two weeks," said Wright, who has applied for "tons" of writing and editing jobs, and only just found part-time work this week. Now that federal benefits are done, Wright will be covering expenses out of her savings.
Perhaps more instructive is the claims data for Pandemic Emergency Unemployment Compensation.
This program essentially extended benefits for jobless workers who had exhausted their 26 weeks of regular state unemployment. Data for these extended benefits shows how unemployment can linger for months and even years during a recession. It also underscores how long-term unemployment disproportionately affects certain job types and demographic groups — often, those that were already struggling.
Consider the industries with the heaviest concentration of extended pandemic claims.
Top of the list is the restaurant and hotel industry, which saw some of the biggest job losses early in the pandemic and still is around 13% smaller than it was in 2019. Although the industry represented 8.4% of the state's workforce before the pandemic, it accounted for a much larger share — around 13.4% — of extended-benefit claims filed during the program's final week.
Manufacturing, which accounted for 8.5% of the state's pre-COVID-19 labor force, totaled 11.5% of extended unemployment claims. Other sectors disproportionately affected by long-term unemployment include construction, transportation and education.
"It looks pretty bleak at the moment," said a Seattle-area man who lost his job as a community college professor early in the pandemic and has been unable to find another teaching position in a sector that is still suffering from lower enrollment. Although he has been searching for work since last year, "there were no jobs whatsoever to apply for in my field, or even closely related."
The hardest hit
Since the first layoffs in March 2020, it has been clear that certain demographic groups were bearing the brunt of pandemic job losses, and the final week of pandemic claims only further underscored that disparity.
Black workers, who make up 4.2% of Washington's workforce, accounted for nearly 1 in 10 of the individuals filing for both federal pandemic programs last week.
Similarly, workers with a high school education or less, who make up 24.4% of the state workforce, filed for around 36% of the claims for federal pandemic benefits. By contrast, workers with a bachelor's degree or higher, who represent nearly 37% of the state workforce, accounted for only around 19% of last week's claims.
Those education disparities reflect the way the pandemic has exacerbated preexisting gaps, economists say. Even in a normal economy, "the jobs that don't require extensive education and training often have higher turnover, and those are precisely ... the jobs that are the most vulnerable in any economic downturn, including this one," said Vance-Sherman.
Older workers continue to face a disproportionate risk of unemployment during the pandemic. Individuals aged 65 and above make up just 5.4% of the state's workforce, but around 9.4% of last week's federal pandemic claims.
Many of the workers who shared their stories with The Times were in their 60s or older, and several feared they were being passed over in favor of younger, less experienced workers with lower salary requirements. Many employers "want entry-level or midlevel workers," said Wright, the copy editor.
The stigma of unemployment
For many affected workers, the financial stress of losing benefits has been compounded by their own conflicted feelings about receiving benefits.
"I never needed to go on public assistance before," said Patrick, a Seattle-area accountant who collected federal pandemic benefits after his hours were cut by more than two-thirds early in the pandemic. "There's a piece of me that says, 'you know, I don't want people to really know this about me.' "
Claimants were painfully aware of the often-critical public attitudes toward the unemployed and pandemic benefits — attitudes that, in their view, frequently ignore the obstacles faced by many job seekers in the pandemic.
Eighteen months into the pandemic, "people's understanding is like, 'oh well, you should have a job by now,' " said Mike Murphy, a Seattle web designer who was laid off in October 2020 and had to fit his job search around parenting duties while his two kids did remote learning.
Although the extended pandemic benefits were "just instrumental in maintaining the stability of our household," Murphy said, the weekly payments never reduced the pressure he felt to get rehired as quickly as possible.
In recent months, Murphy said, the job market has begun to improve. But with pandemic benefits expiring, he now worries he'll be forced to take a job at a substantial pay cut, which would make it difficult to raise a family, "especially in a place as expensive as Seattle," he said.
Wright, the copy editor, echoes that concern about the timing of the benefit expiration, given the recent surge in coronavirus cases.
"I really wish that they had extended the pandemic benefits at least a few more months ... until people felt more confident that we're out of this," Wright said. The pandemic "is not over yet."