Amid historically low unemployment, uptick expected from virus impact

Amid historically low unemployment, uptick expected from virus impact

By WILL WHATLEY, Alabama Daily News

MONTGOMERY, Ala. – State officials announced this week Alabama’s January unemployment rate remained at a record-low 2.7%, but an uptick is expected eventually as businesses and industries are affected by the coronavirus and efforts to slow its spread.

To help those affected by business closures or slowdowns, the Alabama Department of Labor has modified existing rules to allow workers to file a claim for unemployment compensation benefits.

“Many changes are happening quickly with regards to Alabama’s workforce, and it’s important to ensure that we are offering as many available options to those who find themselves in different employment situations,” Gov. Kay Ivey said in a written statement. “As always, we stand ready to assist Alabama’s workers in any way we possibly can.”

To meet these rules, workers must be affected in one of the following ways:

  • Those who are quarantined by a medical professional or a government agency;
  • Those who are laid off or sent home without pay for an extended period by their employer due to COVID-19 concerns;
  • Those who are diagnosed with COVID-19;
  • Or those who are caring for an immediate family member who is diagnosed with COVID-19.

People who are being paid to work from home, or those receiving paid sick or vacation leave are not eligible for unemployment compensation benefits, regardless if they experience any or all of the situations listed above.

Katie Boyd Britt, president and CEO of the Business Council of Alabama, said businesses around the state are “evaluating their circumstances” and adjusting to protect the health of workers and the public.

“Restaurants, retailers and pharmacies have quickly established curbside and delivery services.  Our grocery stores, truckers, and farmers are working to tirelessly to keep shelves stocked for Alabama families” Britt said.

“BCA continues to be committed to working with our partners, like the National Federation of Independent Businesses and local chambers, to ensure small business is represented at both the state and federal level. We are encouraged by the concerted efforts in communities across our state to show added support for their local businesses.”

Rosemary Elebash, state director of the NFIB, said the coronavirus response will result in somewhat of a mixed bag for small businesses.

“Janitorial services will very likely see an increase while retail services expect a downturn,” she said. “But small businesses are very creative when it comes to these type of situations.”

On Tuesday, the Alabama Department of Public Health ordered that bars, restaurants and other food service establishments cease on-premises eating or drinking in Jefferson County as well as surrounding Tuscaloosa, Walker, Blount, St. Clair and Shelby counties. Jefferson has by far the highest infection rate in the state, as 21 individuals had tested positive for COVID-19 by Tuesday afternoon.

Ivey said Tuesday that her office is working with the U.S. Small Business Administration to make Alabama eligible for the Economic Injury Disaster Loan program. SBA is offering low-interest loans to provide capital to businesses suffering a “substantial economic injury” as a result of COVID-19. Currently, only certain areas of Connecticut, California, Maine and Washington State are eligible for the loans.

According to the ADOL, the requirement that a laid-off worker be “able and available” to work while receiving unemployment compensation benefits has been modified for claimants who are affected by COVID-19 in any of the qualifying situations. Additionally, claimants will also not have to search for other work provided they take reasonable steps to preserve their ability to come back to that job when the quarantine is lifted or the illness subsides. The waiting week, which is typically the first week of compensable benefits, will also be waived. Employers who decide to shut down due to causes related to COVID-19 should treat the shutdown as a temporary layoff. These rules are subject to change pending congressional action.

“We understand that we are entering a difficult time for workers and employers,” ADOL Secretary Fitzgerald Washington said. “We want to help those who may be temporarily financially impacted by helping them to replace some of their lost income while being unable to work. We are working with both federal and state government to ensure that we are doing all that we can to help ease the burden during a potentially trying time.”

Certain criteria and exceptions may apply, and are subject to change. Verification of illness or quarantine may be required. Workers can file for benefits online at www.labor.alabama.gov or by calling 1-866-234-5382. Online filing is encouraged.

January’s unemployment rate stayed at December’s historic low of 2.7%. By comparison, January 2019’s unemployment rate was 3.6%.

“We are pleased to be able to maintain last year’s record low unemployment rate in Alabama,” Ivey said.  “We will continue to focus efforts on job creation and workforce development, and remain hopeful that the economic good news will continue into the remainder of 2020.”

According to the Alabama Department of Labor, January’s numbers represent an over-the-year increase in employment of 27,893, with the monthly total registering 2,186,364. The number of people counted as unemployed measured 61,114, a new record low, and represents an over-the-year drop of 18,346. Over the year, wage and salary employment increased 19,200, with gains in the government sector (+6,900), the education and health services sector (+4,300), and the trade, transportation, and utilities sector (+3,400), among others.

“Two big industries experienced significant over-the-year employment growth, with building construction experiencing an increase of nearly 13%, and motor vehicle manufacturing saw growth of nearly 6%,” Washington said. “Wages have also seen growth from this period last year. Alabama workers saw their average weekly earnings grow by $41.74.”

Building construction employment increased 12.56% over the year, measuring 22,400 in January. Motor vehicle manufacturing employment increased 5.84% over the year, measuring 14,500 in January.

While the unemployment rate is at an all-time low, that’s surely to change moving forward with the impact of COVID-19, commonly referred to as the coronavirus.