Please ensure Javascript is enabled for purposes of website accessibility
Jobless Claims at 870,000 as Fraud and Backlogs Cloud Data
gvw_ap_news
By Associated Press
Published 4 years ago on
September 24, 2020

Share

WASHINGTON — The number of people seeking U.S. unemployment aid rose slightly last week to 870,000, a historically high figure that shows that the viral pandemic is still squeezing restaurants, airlines, hotels and many other businesses six months after it first erupted.

The figure coincides with evidence that some newly laid-off Americans are facing delays in receiving unemployment benefits as state agencies intensify efforts to combat fraudulent applications and clear their pipelines of a backlog of jobless claims.

The figure coincides with evidence that some newly laid-off Americans are facing delays in receiving unemployment benefits as state agencies intensify efforts to combat fraudulent applications and clear their pipelines of a backlog of jobless claims.

California has said it will stop processing new applications for two weeks as it seeks to reduce backlogs and prevent fraudulent claims. Pennsylvania has found that up to 10,000 inmates are improperly receiving aid.

The Labor Department said Thursday that the number of people who are continuing to receive unemployment benefits declined to 12.6 million. The steady decline in that figure over the past several months reflects that some of the unemployed are being re-hired. Yet it also indicates that others have exhausted their regular jobless aid, which last six months in most states.

In addition to those receiving aid on state programs, about 105,000 others were added last week to an extended jobless-benefits program that provides 13 additional weeks of aid. This program, established in the economic relief package Congress passed earlier this year, is now paying benefits to 1.6 million people.

Applications for jobless aid soared in the spring after the viral outbreak suddenly shut down businesses across the country, which cost tens of millions of jobs and triggered a deep recession. Since then, as states have slowly reopened their economies, about half the jobs that were initially lost have been recovered.

3.4 Million People Are Receiving the Aid, Down From 6.4 Million the Previous Week

Yet job growth has been slowing, and unemployment remains elevated at 8.4%. In most sectors of the economy, employers appear reluctant to hire new workers in the face of deep uncertainty about the course of the virus. Most economists say it will be hard for the job market or the economy to sustain a recovery unless Congress enacts another rescue package for individuals, businesses and states. Ultimately, an effective vaccine will likely be needed for the economy to fully regain its health.

The growing concerns about fraudulent applications have focused mainly on a new program, Pandemic Unemployment Assistance. This program made self-employed people, gig workers and contractors eligible for jobless aid for the first time.

But the program has been targeted for fraud in many states and has also double-counted many beneficiaries. Last week, California cut in half the number of people receiving benefits under PUA, likely after purging double-counts. It now says 3.4 million people are receiving the aid, down from 6.4 million the previous week.

And first-time applications for benefits, which generally reflect the pace of layoffs each week, often include leftover claims from previous weeks.

Christopher Thornberg, a founder of Beacon Economics, an economic consulting firm, says all the new programs to provide aid have taxed most states’ unemployment agencies and made the data less reliable.

“It’s kind of the Wild West,” Thornberg said. “I have just largely dismissed this data.”

Other State Unemployment Agencies Have Been Bedeviled by Fraud

Sharon Hilliard, director of California’s Employment Development Department, said her agency has stopped accepting applications for aid for two weeks while it adopts reforms recommended by a state task force. The department will try to clear a backlog of nearly 600,000 first-time applications and review about 1 million people who have received benefits but whose cases have come under scrutiny. These people include gig workers and contractors who have more difficulty verifying their income than do traditional employees whose tax forms are on file with the state.

“It’s literally the difference between food on my table or not. I’ve got a 2-year-old, and I’m not really sure how I pay for anything in the coming weeks.” — Kimberly Maldonado, a 31-year-old out-of-work music instructor

Kimberly Maldonado, a 31-year-old out-of-work music instructor, is among the thousands of Californians whose unemployment aid is tied up by bureaucratic snags and the state’s decision to suspend the processing of new applications.

Maldonado applied for benefits four weeks ago. She said she calls daily to check on the status yet reaches only a recording that says the department is overwhelmed. For her, the wait is growing critical.

“It’s literally the difference between food on my table or not,” says Maldonado, who lives in Placentia. “I’ve got a 2-year-old, and I’m not really sure how I pay for anything in the coming weeks.”

Other state unemployment agencies have been bedeviled by fraud since the pandemic intensified in March. As tens of millions were laid off, applications for aid overwhelmed the agencies, which just weeks earlier had been operating with the lowest unemployment rates in 50 years. A now-expired $600-a-week federal unemployment benefit, on top of regular state benefits, provided an added incentive to apply for aid.

A Scheme to Fraudulently Obtain Jobless Benefits for Ineligible Prisoners

Washington was the first state to be hit as an international fraud ring based in Nigeria managed to steal up to $650 million in benefit payments, although at least half that money has been recovered. Texas, Florida and Oklahoma have also been affected.

In Pennsylvania, investigators are also tackling fraud. On Wednesday, state officials announced that 18 state prison inmates and two girlfriends of inmates on the outside had been charged in what officials described as a scheme to fraudulently obtain jobless benefits for ineligible prisoners.

After cross-checking unemployment applications with state prison rolls, they found 10,000 people on both lists — more than one-fifth of the state’s prison population. The 20 people who were charged Wednesday had sought a combined $300,000 in money from the Pandemic Unemployment Assistance program, state Attorney General Josh Shapiro said.

State Rep. Sheryl Delozier was the victim of a more sophisticated scheme. This summer, she got word from tenants that she had important-looking mail at a property she rents out: Envelopes containing two checks totaling $7,100 for retroactive pandemic unemployment payments. She had never applied for the money.

The plot was thwarted, Delozier believes, by the state’s decision to send applicants’ first payments by mail before allowing them to switch to online payments. Delozier alerted officials and returned the checks.

RELATED TOPICS:

DON'T MISS

The Latest | Dozens of Israeli Protesters Attack a Truck in an Apparent Effort to Block Gaza Aid

DON'T MISS

Computer Science, History Students Selected for Fresno State’s Highest Academic Honors

DON'T MISS

$20 Billion: The Delta Tunnel’s New Price Tag

DON'T MISS

NFL Distances from Chiefs Kicker Butker’s Commencement Remarks

DON'T MISS

Some UC Regents Sit Down with Pro-Palestinian Protesters at UC Merced

DON'T MISS

The Unofficial Spokesman for the American Muscle Car, Tim Kuniskis, Is Retiring

DON'T MISS

Billionaires Urged NYC Mayor to Use Police on Columbia Protesters, Chats Reveal

DON'T MISS

Psychedelic Therapy and Workers’ Rights Bills Fail to Advance in California’s Tough Budget Year

DON'T MISS

Man Sentenced to 30 Years for Hammer Attack on Nancy Pelosi’s Husband

DON'T MISS

Chip Foose: Maestro of Metal, Magic, Mind-Blowing Machines

UP NEXT

Lainey Wilson Triumphs at 2024 Academy of Country Music Awards

UP NEXT

California Professor to Stand Trial for Death of Pro-Israel Protester

UP NEXT

Texas Governor Pardons Ex-Army Sergeant Convicted of Killing BLM Protester

UP NEXT

Justice Department Moves to Reclassify Marijuana as Less Dangerous Drug

UP NEXT

Suicide of 10-Year-Old Indiana Boy Linked to Horrific Bullying at School

UP NEXT

‘Mad Max’ Has Lived in George Miller’s Head for 45 Years. He’s Not Done Dreaming Yet.

UP NEXT

US Military Reports First Drop in Sexual Assaults After Years of Increase

UP NEXT

Biden, Trump Agree to Debates in June and September, Logistics Pose Challenges

UP NEXT

US Suggests Possibility of Penalties if Production of Chinese Electric Vehicles Moves to Mexico

UP NEXT

Man Gets 25 Years in Fatal Shooting at Lovers Lane Gas Station in Visalia

NFL Distances from Chiefs Kicker Butker’s Commencement Remarks

43 mins ago

Some UC Regents Sit Down with Pro-Palestinian Protesters at UC Merced

44 mins ago

The Unofficial Spokesman for the American Muscle Car, Tim Kuniskis, Is Retiring

50 mins ago

Billionaires Urged NYC Mayor to Use Police on Columbia Protesters, Chats Reveal

58 mins ago

Psychedelic Therapy and Workers’ Rights Bills Fail to Advance in California’s Tough Budget Year

59 mins ago

Man Sentenced to 30 Years for Hammer Attack on Nancy Pelosi’s Husband

1 hour ago

Chip Foose: Maestro of Metal, Magic, Mind-Blowing Machines

1 hour ago

The Latest Hot Spot for Illegal Border Crossings Is San Diego. But Routes Change Quickly

2 hours ago

Lainey Wilson Triumphs at 2024 Academy of Country Music Awards

3 hours ago

Timberwolves Force Game 7 by Blowing out Nuggets by 45 Points

3 hours ago

The Latest | Dozens of Israeli Protesters Attack a Truck in an Apparent Effort to Block Gaza Aid

Dozens of Israeli protesters attacked a truck in the occupied West Bank, beating its driver and setting it on fire in an apparent attempt to...

32 mins ago

32 mins ago

The Latest | Dozens of Israeli Protesters Attack a Truck in an Apparent Effort to Block Gaza Aid

34 mins ago

Computer Science, History Students Selected for Fresno State’s Highest Academic Honors

38 mins ago

$20 Billion: The Delta Tunnel’s New Price Tag

43 mins ago

NFL Distances from Chiefs Kicker Butker’s Commencement Remarks

44 mins ago

Some UC Regents Sit Down with Pro-Palestinian Protesters at UC Merced

50 mins ago

The Unofficial Spokesman for the American Muscle Car, Tim Kuniskis, Is Retiring

58 mins ago

Billionaires Urged NYC Mayor to Use Police on Columbia Protesters, Chats Reveal

59 mins ago

Psychedelic Therapy and Workers’ Rights Bills Fail to Advance in California’s Tough Budget Year

MENU

CONNECT WITH US

Search

Send this to a friend