The coronavirus is wreaking unprecedented havoc on the American economy, as social distancing and lockdown orders are forcing a devastating number of small businesses to close their doors. As a result, millions of workers across the country have lost their jobs and now find themselves filing for unemployment benefits. Workers in Louisiana may be hit the hardest by this unemployment surge, as a report by the Center on Budget and Policy Priorities found that Louisiana ranks dead last among all 50 states in the average weekly benefit it pays in relation to workers' average weekly salaries.
According to the Federal Department of Labor, Louisiana pays an average of just $216 per week in unemployment benefits. This is only 23% of what the average Louisiana worker earns in a week, which is particularly grim when compared to the first ranked Hawaii, which pays its jobless workers 55% of their weekly wages. Additionally, strict state restrictions on unemployment benefits mean that only 11% of unemployed workers are able to receive unemployment insurance. The shortcomings of Louisiana's unemployment support have come under sharp scrutiny, as an overwhelming number of workers have been forced to file for unemployment in the wake of the coronavirus. According to the Louisiana Workforce Commission, the agency has received 70,601 claims for unemployment benefits in the week of March 15, a staggering deviation from the 1,500 weekly claims filed on average.
Louisiana has a long history of underpaying its jobless workers. The state has made numerous deals with the private sector, resulting in a system where low state taxes are prioritized over stronger unemployment benefits. Although the state trust currently contains nearly $1.1 billion, Louisiana still only pays a maximum of $247 per week in unemployment benefits.
"That's a system that's barely functioning," said Michael Leachamn, senior director of state fiscal research for the CBPP. "People lose their jobs. They need some kind of support to get by. The economy also needs those families to have some income so they can keep spending, otherwise the recession just gets worse. Louisiana's choice to have an unemployment system that barely functions is going to mean that the emerging recession will hit the state and its people much harder than if Louisiana had more foresight in that area."
However, there may be a silver lining for Louisiana workers, as Congress is currently working to pass a stimulus bill to provide immediate economic relief to employees laid off during the virus outbreak. Although the Senate continues to debate the details of the bill, it is expected that unemployed workers will be given an additional $600 per week through June 30. The bill will also be more inclusive in defining who qualifies for unemployment benefits, and will give workers an additional 13 weeks during which they can receive benefits.