As the impact of COVID-19 evolves, and the number of new infections and deaths start to decrease, we can start assessing its impact on our economy’s future.
In the week ending April 4th, over 6 million people applied for unemployment assistance due to layoffs caused by the pandemic. In the same week of 2019, there were only 196 thousand unemployment claims. That shows us an increase between then and now of over 2,900%. In other words, it’s a huge jump.
Using COVID-19 projections from the Institute for Health Metrics and Evaluation (IHME) along with state-level population and demographic data from the Census Bureau, the Wonderlic AI team developed a model to predict the progression of unemployment claims over the next several months. The interactive chart explores our projections of unemployment assistance in the United States, and compares them to the IHME estimates for infections, deaths, and hospital resources used as a result of the pandemic. For more information on the technical details of the model, please check out our GitHub.
COVID-19 data (IHME)
Our model suggests that unemployment claims will continue to fall through the middle of June. We expect them to be high relative to pre-pandemic levels for the foreseeable future, when the economy, stock market, and employment levels were at or near all-time highs.
However, there's room for optimism: as the number of cases decrease and we’re let back into public life, hiring should pick back up, and unemployment claims will continue to fall.
Our predictions are dependent on the current IHME projections which show a single peak in infections. However, other research groups such as CIDRAP predict that there may be a second peak in infections around December. Should this happen, it’s very likely that our model would also show a peak in projected unemployment claims around that time. Whether or not a second peak happens will depend on the response we see from public health experts about how states should open up, as well as any changing guidelines from the federal government.
If you’ve been laid off due to Covid-19, we suggest taking this time to develop yourself professionally, revisit your resume, and brush up on your interview skills. The job market we’re entering will be more competitive than the one that existed pre-pandemic, so it helps to be prepared.
For companies who need to hire back talent, keep in mind that HR processes will be put to the test. There will be far more applicants for open positions than there were prior to Covid-19, when many industries were facing talent shortages. This may be a good time to consider using an assessment tool to help streamline your hiring strategy, making sure you don't overlook your most talented applicants.