By Shereen Siewert
The unemployment rate in Wausau dropped in September after the extension of federal unemployment programs ended by less than one percentage point, according to figures released Wednesday by the Wisconsin Dept. of Workforce Development.
Under the American Rescue Plan Act (ARPA), the extension of federal unemployment programs ended on Sept. 4. The $300-a-week federal check, on top of regular state jobless aid, meant that many of the unemployed received more in benefits than they earned at their old jobs. As local businesses struggled to find workers, many pinned their hopes on the end of additional funding and believed that taking additional unemployment benefits away would force people to fill jobs.
An analysis of state-by-state data found that workforces in the 25 states that maintained the $300 payment, rather than ending them early, actually grew slightly more from May through September, according to data released Friday, than they did in the 25 states that cut off the payment early, most of them in June. The data show that states that cut off extended unemployment benefits did not see people suddenly dive back into the workforce, as some predicted. Instead, states that continued to pay extended benefits saw the fastest return to work.
Analysts say there are many reasons this happened. For example, some workers said the extended unemployment benefits helped them pay for child care. Without child care, some adults said they could not afford to go to work, especially at low-paying jobs.
In Wausau, DWD figures show that the unemployment rate went from 3.3 percent to 2.6 percent from August to September. In September 2020, the unemployment rate was at 3.7 percent.
Large-scale deviations from economists’ projections the last few months suggest the labor market simply is no longer functioning in the same way it did pre-pandemic, according to Stan Veuger, a senior fellow at the American Enterprise Institute, a right-leaning think tank.
Vueger acknowledges that expanded unemployment benefits led at least some people to stay home rather than searching for jobs. But other factors are in play, he said.
According to a June survey conducted by Indeed, concern about the coronavirus remains the top reason for a lack of urgency in seeking employment by those who remain unemployed. At the same time, a sense of financial security is allowing some unemployed workers to be patient, the Indeed study found. Enhanced UI benefits helped, but spousal earnings and household savings appear to be bigger factors.
In addition, Vueger said, school schedules and the high cost of child care can also be playing a role, while industries hard hit by the pandemic could take some time to rebuild.
‘Help Wanted’ signs pepper the windows of businesses throughout the Wausau area including many fast food restaurants. But for some job seekers, the there appears an incongruity between what they are hearing about jobs and what is actually happening.
According to the Bureau of Labor Statistics, there are 8.4 million potential workers who are unemployed nationwide. At the same time, there are a record 10.9 million jobs open. The rate at which unemployed people are getting jobs is lower than it was pre-pandemic, and it’s taking longer to hire people. Meanwhile, job seekers say some employers are unresponsive.
In short, the jobs available may not be the jobs people want.
“A lot of what people are seeing are low-paying jobs with unpredictable or not-worker-friendly scheduling practices, that don’t come with benefits, don’t come with long-term stability,” Shelly Steward, director of the Future of Work Initiative at the Aspen Institute, told Recode. “And those are not the types of jobs that any worker is eager to take on.”
Officials are struggling to fill positions with the city of Wausau as well. According to city documents, bus operator, equipment services mechanic and firefighter/paramedic positions are among the most difficult to fill, prompting Wausau Human Resources Director Toni Vanderboom to recommend the city make significant changes in the coming months.
Changes recommended for next year include a conducting a culture survey, establish robust training and development programs for hiring candidates who have little or no experience or needed qualifications, such as a commercial driver’s license, changing the way new employees move through the pay scale up to midpoint, and granting lump sum increases to employees who are over midpoint of the salary ranges.