After a wave of initial improvement in the summer, Maine’s jobs recovery appears to have slowed as 2020 draws to a close, according to recently released state and federal data on unemployment claims and employment.
The slowing recovery comes as Maine is experiencing stark spikes in COVID cases and as alarming numbers of Maine families, including those who are working, face increased hardship during the ongoing public health and economic crises.
The COVID relief bill approved by Congress this week (if it is signed into law) and the initial deployment of vaccines to health care workers — and the prospect of more broadly available vaccination sometime next year — provides a first glimpse of light at the end of the tunnel, but Maine still has a long way to go in its recovery.
Another round of federal stimulus and action at the state level will likely be necessary to protect vulnerable Maine families and ensure an equitable recovery.
Unemployment remains high, particularly for women and people of color
The latest data on Maine’s economy show unemployment numbers remain high, especially among service-sector workers, women, and people of color.
Recent data on Unemployment Insurance claims from the Maine Department of Labor shows that more than 43,000 Mainers received unemployment assistance in the week ending December 12. That represents a slight increase over previous weeks, which follows the usual seasonal pattern in Maine of rising claims over the winter months. The relief package approved by Congress on Sunday extends benefits that were set to expire on December 26, providing a lifeline to the roughly 35,000 Mainers who were poised to lose benefits. Benefits will continue for another 11 weeks, through at least March 14.
While the official unemployment rate for November 2020 was a seasonally adjusted 5.0 percent, but this leaves out many people who were jobless and unable to look for work. If the full number of jobless Mainers were included, the unemployment rate would be somewhere between 7.1 and 9.1 percent.
Workers in the hospitality sector – primarily hotel and restaurant workers – remain the most likely to be unemployed. Mainers in other service industries are also disproportionately likely to have lost their jobs.in face-to-face business activity. Unemployed Mainers are also more likely to be women and people of color, according to state data. Black and Indigenous Mainers are both more than twice as likely as white Mainers to be jobless, a trend which has persisted for the past several months.
Jobs recovery slowing as Maine enters winter
Federal jobs data show signals of a stalling recovery as Maine enters the winter months.
The US Department of Labor conducts two surveys to measure employment. One is a survey of households, and the other of businesses. The surveys show different numbers, but the same trend: After an initial period of relatively swift jobs recovery from late spring through summer, the pace has slowed. By averaging the two data sets, we can see the trend clearly.
While Maine has recovered more than half the jobs lost in the initial surge of unemployment this spring, the recovery appears to be stalling. Compared with single-month increases of 10,000 or more jobs added in May and June, Maine recovered a total of 3,600 jobs over the three-month period from September through November, when Maine had an estimated 37,000 fewer jobs than it had at the same point in 2019.
Widespread hardship persists for working families
Beyond unemployment, there are signs of significant hardship for many more Mainers. Federal data from the most recent US Census Household Pulse survey found that 29 percent of Maine adults (roughly 305,000 people) had trouble paying their usual household expenses; 18 percent (29,000 households) were behind on rent, and 6 percent (about 68,000 people) lived in food-insecure households.
The latest relief bill offers some help for these individuals as well. The vast majority of Mainers will receive a direct economic impact payment of up to $600 per adult and dependent child. According to the Institute on Taxation and Economic Policy, 1.2 million Mainers will qualify for the payment, although high-income households will receive smaller payments, with no payment at all for the highest earners. The relief package also extended the federal eviction moratorium through the end of January and established of a new renter’s relief fund. The Supplemental Nutrition Assistance Program will provide increased food assistance through June 30.
Those are good provisions that will provide some relief for struggling Mainers. But the state’s recovery is still dependent on getting the spread of the coronavirus under control. Additional relief will likely be necessary. Even if the vaccine becomes widely available in the spring or summer, it will take time to achieve vaccination levels necessary for a return to pre-pandemic economic activity, and additional time for the economy to rebound and add the jobs necessary for unemployed Mainers to return to work.
The recently passed relief package must be a first step, not a final one.
