The number of Tennesseans filing new claims for jobless benefits fell last week to the lowest level in more than seven months as the state's economy continued to rebound from the record high unemployment levels reached in April due to the coronavirus pandemic.
Last week, 7,770 newly laid-off Tennesseans filed initial claims for unemployment benefits, or less than 7% of the peak number of initial jobless claims filed in early April when much of Tennessee's economy was shut down to limit the spread of the coronavirus.
But over the past seven months, the virus has still cut 899,368 jobs sometime during 2020, leading more than one of every four workers in the state to file for unemployment benefits since March.
"A lot of people have suffered through this pandemic and unemployment is one of the most severe ways that people suffer through, besides the health piece of this," Gov. Bill Lee told reporters this week. "One of the reasons that we have invested money in business ways through the coronavirus funding is to keep those businesses open. The best thing we can do is to make sure there are plenty of jobs in our state so those who are unemployed will have an opportunity to find a job."
Tennessee has used much of its CARES funding to shore up the state's unemployment insurance fund as unemployment has increased in order to avoid a statutorily required increase in unemployment insurance premiums for employers when the fund dips below $1 billion in reserves. Last week, the entire $33.3 million of jobless benefits paid in Tennessee came from the federal government, helping to preserve the trust fund and avoid a tax hike on employers in January.
But those still unemployed are also getting only about a third of what they got earlier this year since the $600-per-week federal supplement ran out at the end of July. Last week, the average jobless benefit paid to those still getting such benefits in Tennessee was $267.98. Unemployed Tennesseans were receiving up to $875 a week in combined federal and state jobless benefits before August.
Congress has broadened both the type of workers who can get jobless benefits and the length of time that displaced workers can get such benefits this year in response to the pandemic. But Tennessee Labor Commissioner Jeff McCord said those extra benefits will expire as of Dec. 26.
"What we hope is that by the end of December... that number (of unemployed persons) will continue to decline," Lee said.
On Thursday, the Tennessee Department of Labor and Workforce Development listed 236,236 job openings across the state.
"We just need to connect those Tennesseans to those job opportunities to make sure that our unemployment rate continues to drop," Lee said.
Nationwide, the number of Americans seeking unemployment benefits fell last week to 751,000, the lowest since March, but it's still historically high and indicates the viral pandemic is forcing many employers to cut jobs.
Applications for unemployment aid fell 40,000 from the previous week, the Labor Department said Thursday. But rising confirmed virus cases in nearly every state, along with a cutoff in federal aid, are threatening to weaken the economy in the coming months. As temperatures fall, restaurants and bars will likely serve fewer customers outdoors. And many consumers may increasingly stay home to avoid infection. Those trends could force employers to slash more jobs during the winter.
With Congress having failed to agree on any further stimulus this year, millions of unemployed Americans who will lose all their jobless benefits in the coming weeks and months will likely pull back further on spending.
The still-elevated number of jobless claims underscores that a full recovery from the pandemic recession remains far off. Job growth has slowed for three straight months, leaving the economy still 10.7 million jobs short of its pre-pandemic level. The unemployment rate remains high at 7.9%, although Hamilton County's rate dropped in September to 5.6% and is likely to fall further during the holiday season ahead.
Contact Andy Sher at asher@timesfreepress.com or Dave Flessner at dflessner@timesfreepress.com. The Associated Press contributed to this report.