State unemployment spikes due to COVID-19


CHEYENNE - As unemployment claims across the U.S. have skyrocketed to unprecedented rates, the Wyoming Department of Workforce Services has seen a similar pattern in the Cowboy State.

"We are definitely seeing an increase - a fairly significant increase - in the number of claims," DWS Communications Manager Ty Stockton said Thursday.

Though it doesn’t yet have data to show the extent of the increase, Stockton said the department is already making adjustments to help meet the higher demand. 

About 15 employees, either new hires or staff from other divisions, have been brought on to help with claims, and the department is attempting to add new phone lines to help decrease call times.

While the department has long wait times over the phone, Stockton said its staff can quickly sort through online claims. And even though the demand has risen, Stockton said residents shouldn't expect any delays in receiving assistance at this time.

According to Stockton, the other functions of Workforce Services have taken a "back seat" to helping those who have been laid off due to the pandemic. Stockton said the hope is that the layoffs are just temporary, and those people will be rehired when things return to normal.

"But for the time being, they still have to support their families and pay their bills," Stockton said. "Unemployment insurance can help with that."

According to predictions from the Economic Policy Institute, Wyoming is projected to lose more than 25,000 jobs by summer, which is almost 12% of the state's share of total private-sector employment. Almost 30% of job losses are expected to come from the leisure, hospitality and retail industries.

And in Laramie County, about 20% of the local workforce is composed of employees in the retail, restaurant and lodging industries, according to Wyoming Economic Analysis Division Chief Economist Wenlin Liu, who called the unemployment statistics "completely unprecedented."

"With 10% or 20% (of those employees) staying home, that's a huge impact," Liu said.

And according to University of Wyoming economist Rob Godby, "We haven't even seen the worst of that."

Already, some businesses have shut down operations until further notice and laid off workers for the time being. The Plains Hotel closed its doors due to lack of revenue last week, leaving around 30 employees without work for the coming months.

One of the major issues for Laramie County businesses is the reliance on spring and summer months to bolster revenue that was lost over winter. For Astrid, the hotel's owner, that springtime boost never came, leaving her no option other than to close.

"Retail is a big sector in our economy. It's going to be hit not only due to local activity declining, but also in the longer term with our tourism sector declining right now," Godby said.

If the dire economic situation continues into the summer, when tourism in the state normally peaks, Wyoming businesses will face even more losses. Godby said this situation is like no recession the country has ever seen, going "from an economy that's almost booming to an economy that's almost stopped."

Though no shelter-in-place orders have been implemented yet in Wyoming, restaurants can only provide delivery or carry-out, and shops that provide nonessential products or services have to stop working altogether. In a normal recession, layoffs are usually the result of bankruptcy or other financial issues, but that isn't quite the case today.

Liu said, "Regardless of how good your business is, the regulations have to order you to close."

Previous recessions began with slowdowns in the production sector - for example, a decrease in home building. But now, the reductions are led by the service sector, with the closing of barbershops, hair salons and the like.

"This recession is the worst in sectors that typically are a little more resilient to an economic slowdown," Godby said. "In a normal recession, people still need haircuts, and they can still get them. But that's not the case right now."

Another issue in Wyoming is how much the state's most profitable industry depends on what is happening elsewhere. Wyoming's energy sector will take hits both on the supply and demand sides, which could have trickle-down effects in the state.

"Oil will be hit hard by reduced industrial production, as well as reduced transportation demand. Gas will be hit by reduced electricity demand, as well as reduced industrial demand. And coal is clearly going to be hit by less electricity demand elsewhere," Godby said. "So those problems are going to hit us."

When the stock market crashed in 2008, the economy picked back up again after a stimulus package from the federal government. But the problem in this scenario is that the slowdowns in business aren't solely due to the economy's performance.

"The public health crisis drives the economic effects," Godby said. "Absolutely, it's a perfect storm."

To apply for unemployment

Due to a high call volume, the Department of Workforce Services is asking residents who are seeking assistance to submit their application online at wyui.wyo.gov.

Advertisement