Our view: The dismal jobless rate


Good afternoon,

There’s no way to sugarcoat the latest jobless report for Delaware.

The 15.8 percent rate for May is appallingly high.

As was the case in April, job losses took place across the board.The largest decline by far comes in the hospitality category that includes casinos, restaurants, and hotels. (See graph).

The loss in the hospitality sector was especially painful since the category was the reason for much of the job growth during the past year or so.The Delaware Restaurant Association says Delaware job losses in the dining subcategory was the third-largest in percentage terms among the 50 states.

The losses are three-times the figure for wholesale and retail trade, a category that was buoyed to some degree by big box stores and supermarkets, which continued to hire during the pandemic.

It is worth noting that unemployment figures are based on sampling. The numbers become more accurate and are often adjusted months later when payroll figures begin to make their way to labor departments.

Some have speculated that the 13.3 percent jobless rate reported nationwide for May is faulty, due to the difficulties of collecting information in the current environment.

One wild card is the separate jobless benefits program for the self-employed who lost their livelihoods during the pandemic. The program required a separate information technology system and has a vast potential for fraud. That slows down the process of verifying applications.

We’ll know more about the actual jobless rate in the coming months as the effects of the Payroll Protection Program wear off and, openings continue.

The PPP, as noted in yesterday’s Our View forgives, loans for companies that retained their staffs during COVID-19 lockdowns and has by many accounts has not done a good job of reaching businesses owned by people of color, or those located in rural areas.

Have a great weekend. This newsletter returns on Monday. – Doug Rainey, chief content officer.

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