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Only a Quarter of Unemployed US Workers Filed for Benefits in 2022

Only a Quarter of Unemployed US Workers Filed for Benefits in 2022 By Bloomberg

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Economy 42 minutes ago (Mar 30, 2023 17:06)

© Reuters.

(Bloomberg) — Only about a quarter of unemployed US workers applied for jobless benefits in 2022, suggesting unemployment claims could be much higher, according to an analysis by the Bureau of Labor Statistics.

Of those who didn’t apply, more than half of workers said it was because they didn’t believe they were eligible, the BLS said in a report Wednesday. Close to one-in-five abstained because they expected to start working soon.

Whatever the reason, not applying is a simple explanation that could, at least in part, be keeping jobless claims historically low. Data out Thursday showed initial and continuing applications ticked up last week but are still below their pre-pandemic levels.

More generally, the labor market is exceptionally tight — unemployment is near the lowest in five decades and there are nearly two open jobs for every person who wants one.

Economists have wondered why hundreds of thousands of layoffs that began toward the end of 2022 have yet to yield a rise in jobless claims. Some say it’s because those job cuts may take months to actually materialize, while others point to severance payments as delaying or preventing filing.

Only people who have previously worked are eligible for the benefits, and they generally must apply shortly after separating from their last job. Therefore, the BLS data reflect people who worked at some point in the 12 months prior to the survey, which collected data in February and May 2022. Eligibility for benefits also varies by state.

Other highlights from the report include:

One-in-10 cited attitudes about or barriers to applying, like if they didn’t need the money, were embarrassed or had problems with the application process.
The likelihood of applying for benefits increased with age. About 8% of unemployed people ages 16-24 had applied since their last job, compared with 35% of those 55 and over.
Older workers generally have longer periods of unemployment when they lose a job, which may be why they’re more likely to apply.
There was little difference in applying by gender or race.

©2023 Bloomberg L.P.

Only a Quarter of Unemployed US Workers Filed for Benefits in 2022

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