Job Losses During the Onset of the COVID-19 Pandemic: Stay-at-home Orders, Industry Composition, and Administrative Capacity
SSRN Electronic Journal(2020)
Abstract
Six weeks after the national emergency declaration for the COVID-19 pandemic, unemployment insurance (UI) claims as a share of total state employment differed by as much as 24 percentage points across states. This paper examines three explanations for these dramatic differences: statewide stay-at-home orders, the industry composition of states' employment, and the historical utilization of states' UI systems. We find that i) the surge in UI claims began and often peaked before states enacted stay-at-home orders; ii) relative to other states, states that would eventually enact stay-at-home orders had high UI claim rates before the orders were enacted; iii) six weeks after the national emergency declaration, statewide stay-at-home orders accounted for less than 30% of the difference in cumulative initial UI claims between states that ever-versus-never enacted statewide stay-at-home orders; iv) industry-related exposure to the COVID-19 pandemic can account for twice as much of the state-level variation in UI claims relative to stay-at-home orders; and v) states with greater historical utilization of their UI systems by unemployed workers tended to both receive more UI claims and process these claims more quickly at the onset of the COVID-19 pandemic.
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Key words
industry,losses,stay-at-home
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