(The Center Square) – Minnesota was the 12th most recovered state in the nation since the beginning of the COVID-19 pandemic crisis, WalletHub reported Thursday. However, the state was ranked 42nd in the nation for improvements in the past seven days.
Minnesota is one of 12 states whose unemployment claims last week were not lower than before the pandemic, the report said. It joins Wisconsin, Michigan, Indiana, Florida, Alabama, California, Tennessee, Hawaii, Alaska, North Carolina and New Mexico in that count.
North Carolina, New Mexico and Tennessee had recovered least since last week, while Georgia, Nebraska and Kentucky had recovered most, the report said. Kansas, Florida and New Hampshire have recovered most since the start of the COVID-19 crisis. District of Columbia, Rhode Island and Delaware are on the other end of the spectrum.
Minnesota’s initial unemployment claims in the week of Nov. 29, 2021, were 8.28% higher compared with the week of Dec. 2, 2019, and 35.98% higher than the start of 2020. However, they were 60.61% lower compared with the same week of Nov. 30, 2020. Unemployment claims from March 15 to November 29 this year were 82.55% lower compared with March 16, 2020, to Nov. 30, 2020.
Minnesota did not terminate enhanced federal unemployment benefits related to the COVID-19 pandemic early. Neighboring states Iowa, North Dakota and South Dakota have ended those benefits early.
Minnesota is a Blue state based on its endorsement of President Joe Biden in the 2020 election. Overall, Blue state unemployment claims (25.00 average rank) are recovering more quickly than Red states (27.04).
About 7 million Americans are unemployed due to the COVID-19 pandemic. The report said that 184,000 new unemployment claims were filed nationally last week, down 97% from the 6.1 million that occurred during the peak of the pandemic.
University of Minnesota Carlson School of Management Mary and Jim Lawrence Fellow and Associate Professor Alan Benson said in the report that by itself, unemployment insurance claims are not a great measure of economic success. It doesn’t account for people who are underemployed or leave the labor force because they give up on looking for work.
“If you tally the number of people on unemployment insurance, you are missing a lot of people: people who exhausted their benefits, people who have not yet earned their benefits, people who are disqualified, or people who just do not file,” he added. “Moreover, the measure itself depends on who is eligible for unemployment. Surely more people do not become ‘unemployed’ as soon as the eligibility criteria change.”
The $1.9 trillion emergency relief package American Rescue Plan Act Congress and President Joe Biden passed is “truly historic” in size but doesn’t achieve full relief, he said.
“Many young working families got child tax credits, for example, but will not necessarily compensate for the long-term career impacts if, say, one household member drops out of the labor force or switches to part-time to cover lost child care or help their kids through remote school,” Benson said. “Similarly, people graduating from school in 2020 may get some temporary relief, but there’s good evidence that the effects of graduating in a recession last a very long time.”
The stimulus could add to national debt, prompt inflation or require raising interest rates, he said.
“The relief package is really just meant to alleviate the shock,” he said.
He said stimulus payments are designed to go to people who are believed to spend it rather than save it and the stimulus could help people keep their jobs, support the health of retirement accounts, support basic government services and hasten recovery.
“We all benefit from a healthy economy,” he said.
He said vaccine distribution is critical for reducing infection rates, reopening the economy and building consumers’ confidence.
“There has been a lot of press about the pressure on state and local governments to ease restrictions, but there’s also evidence that economic recovery will also require consumers to be confident that they can safely resume normal activities,” Benson said.