August 6th Analysis of Unemployment Insurance Claims in California During the COVID-19 Pandemic

Background: The COVID-19 crisis has led to historically unprecedented increases in the level of initial Unemployment Insurance (UI) claims filed in California since the start of the crisis in mid-March. Through a partnership with the Labor Market Information Division of the California Employment Development Department, the California Policy Lab is analyzing daily initial UI claims to provide an in-depth and near real-time look at how the COVID-19 crisis is impacting various industries, regions, counties, and types of workers throughout California.

The Policy Briefs are updated on a monthly basis.

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August 6th Policy Brief

By Alex Bell, Thomas J. Hedin,Geoffrey Schnorr and Till von Wachter

REPORT: August 6th Analysis of Unemployment Insurance Claims in California During the COVID-19 Pandemic PDF

PRESS RELEASE: New Analysis: More than Half of Recent Unemployment Claims are from Californians who are Re-Opening their Claims

Key Research Findings

1. More than Half of Recent Unemployment Claims are from Californians who are Re-Opening their Claims. The steady rise in initial claims since May 17th is driven by an increasing number of additional claims—claims which are “reopened” after a claimant’s temporary return to work. In the week ending July 25th, 57% of regular initial claims were additional claims, compared to just over 40% before the crisis, and approximately 5% at the peak of the crisis.

2. The number and share of additional claimants varies significantly by industry. Accommodation and Food Services, Retail Trade, and Arts, Entertainment are making up most of “Additional Claims”.

3. Nearly one-third of California workers have filed for UI benefits since the start of the COVID-19 crisis in mid-March. This is the first time we are able to report the number of unique claimants in the state, instead of tallying all initial claims, which results in substantial double-counting. Since many of these 6.23 million workers have filed multiple claims, this total is substantially smaller (24% less) than the 8.18 million initial claims that have been filed in the same period.

4. For the week ending July 11th, 3.28 million claimants, or about 17% of the CA labor force, were paid unemployment insurance benefits. 2.91 million individuals, or 15% of the labor force, received full benefits, without any reduction for earnings.

5. The share of paid UI claimants receiving partial benefits (due to reporting some work earnings) has risen substantially since early May. In the week ending July 11th, 2.7% of the labor force either received partial UI benefits or were denied benefits due to excess earnings.

6. As illustrated in our Data Point, without the $600 per week additional benefits from FPUC, half of all individuals receiving UI benefits would have received payments below the Federal Poverty Level. California claimants have received $35.5 billion in FPUC payments for unemployment experienced between the start of the program and July 11th.

7. New Initial Claimants are increasingly unlikely to report they expect to later be recalled to their employer when they file their claims. In the week ending July 25th, only 63% of new initial claimants reported they expect to be recalled. The gap in recall expectations between Black claimants and others’ which was seen earlier in the crisis appears to have narrowed in recent weeks.

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