September 16, 2021

Cortland County jobless rate could hit 20%

Cortland County Seal

Red Jug Pub owner Tom Terwilliger faces what many other bars across the state face laying off people — about 42 in Cortland and more than 100 across his three locations.

“This is the rarest occasion one can imagine,” Terwilliger said. “I’m unemployed by no fault of my own.”

Since March 21, Cortland County people have filed 3,416 claims for unemployment insurance, show state Department of Labor data. That’s up from 209 in the same six week period a year ago.

With only about 23,100 workers in the county, that many unemployment filings creates a 14.8% unemployment rate, almost the exact unemployment rate across the entire country — 14.7%.

That national number is the highest it has been since the Great Depression.

However, the unemployment rate in the county was 6% in March, the state reports, and that would be added to the new filings, suggesting unemployment may rise to 20% or more when the Labor Department issues its new jobs and unemployment reports on May 21 and May 27.

The caveat is that those numbers may not represent the official unemployment rate, said Russell Weaver, an economic geographer with the Cornell School of Industrial and Labor Relations Buffalo Lab, which focuses on work, employment and labor.

“The reason involves who gets counted in the official rate. Among folks who aren’t counted are individuals who report that they (1) are not working at the time they are surveyed and (2) are not actively looking for work,” he said. “That definition presents some challenges in times like these … mainly because scores of workers who’ve lost their jobs due to COVID-19 are not going to be actively looking for work.”

Those people may wait until they know from health officials that returning to work will be safe, he said.

Weaver said another measure that should be taken into account and is probably higher than the unemployment rate is labor underutilization — a measure that “adds up (1) unemployed workers, (2) workers working part-time for economic reasons (i.e., they’d rather be working full time), and (3) persons “marginally attached” to the labor force (meaning that they’re not actively looking for work but they’d take a job if one were available to them).”

He said roughly 23% of the U.S. labor is underutilized.

Terwilliger said he will bring some people back until the bar can open up to help with painting and cleaning, but “You can only paint and clean so much.”

He’s told his employees to do their best to file for unemployment, but so far only a handful of employees have been able to successfully sign up for benefits.

“The state’s really falling down on that one,” he said.

Terwilliger hopes that once the bar can open, customers will come but he knows it may not be the same.

“All indications are that we’ll have the clientele when we come back,” he said. “You can’t have a major disruption like this and expect everything to be the same.”

But Terwilliger said employers may also have a hard time getting employees back, especially if they make more on unemployment than they would at their job.

“You can’t blame somebody that makes $400 a week that is getting $800 a week in unemployment,” he said, though his workers have said they’ll return.

Weaver said that now that officials have a better idea of the magnitude of the virus’s effect on employment, they can use those numbers to get out of the business as usual approach.

“It’s going to be necessary for all of us — from residents to elected officials and everyone in between — to start questioning our long-held assumptions about what’s too ambitious or ‘impossible’ in our current political and economic system,” he said.