By James Parrott

There were an estimated 1.3 million New York City residents unemployed and receiving unemployment benefits as of late October. While the number of new unemployment claims has declined in recent months, it is still about half of the weekly level that prevailed in June and July. Net employment might be slowly creeping back up, but only about half of the jobs lost from February to April have been restored and nearly 25,000 New Yorkers are newly filing for unemployment benefits each week (this is four times the prior year’s level). 

In addition to those receiving regular New York State unemployment insurance (UI) benefits, the 1.3 million number includes: dislocated self-employed workers, independent contractors, and others who don’t normally qualify for UI and who instead receive Pandemic Unemployment Assistance (PUA); and also workers receiving Pandemic Emergency Unemployment Compensation (PEUC), which kicks in after the 26-week limit on State UI benefits elapses. Both PUA and PEUC were authorized by the Federal CARES Act enacted in late March, with benefits paid entirely by the Federal government. Both programs will expire at the end of 2020.

Finally, there are also displaced workers receiving extended benefits (EB); this is a permanent Federal-State UI program triggered when a state’s unemployment rate reaches a specified average level for the previous 13 weeks. In New York, the EB program provides up to 20 weeks of benefits following exhaustion of regular State benefits. Under the CARES Act, PEUC was designed to provide extended benefits first; after 13 weeks of PEUC benefits are exhausted, a worker who is still unemployed becomes eligible for the EB program.

See the chart below for the number of State recipients from all programs. (It also shows the small number covered by “work-sharing” arrangements involving reductions in hours worked in lieu of layoffs.)  New York City’s share of statewide recipients has risen in recent months and was about 58 percent of the New York State total in September (the latest month for which data are available).  

 Workers losing their jobs at the beginning of the pandemic in March began exhausting regular UI benefits in September and moved to the PEUC program. As the chart indicates, part of the decline in the number of regular UI recipients can be explained by those workers transitioning to the PEUC program. 

Data from the State Comptroller’s office indicate that unemployed workers in New York State received $53.4 billion in unemployment benefits during the months of March through October. New York City’s unemployed workers received about $30 billion of that total. The chart below indicates the estimated monthly amounts received by the city’s unemployed, and shows how total UI benefits fell off after July when the $600 weekly Federal UI supplement – another feature of the CARES Act – ended.

The bump up in the September amount the chart shows resulted from the Lost Wages Assistance program authorized by President Trump, using Federal Emergency Management Assistance (FEMA) funds. This provided for a $300 weekly UI supplement for six weeks, with the bulk of that paid in late September. 

A worker who became unemployed very early in the pandemic may be eligible for up to 59 weeks of UI benefits (26 weeks of regular benefits + 13 weeks of PEUC + 20 weeks of EB), while a worker who lost her job after the first of July will be eligible for a maximum of 46 weeks (26 weeks regular + 20 weeks EB) since the PEUC program will have expired by the time she exhausts regular UI  benefits. 

Federally funded UI benefits accounted for 77 percent of all UI benefits paid statewide from March through September. As CARES Act provisions expire, the total amount of UI payments to city and state residents will start to plummet in January and deprive hundreds of thousands of households of needed income. For example, when the PUA program expires at the end of December, about half of all city and state UI recipients will lose benefits.

This is part of an ongoing regular biweekly Covid-19 Economic Update series prepared by economist James Parrott of the Center for New York City Affairs with the support of the Consortium for Worker Education and the 21st Century ILGWU Heritage Fund.