Business/Economy

Unemployment insurance claims in Alaska are at ‘historic lows’

While Alaska has lost jobs in the current state recession, claims for unemployment insurance have fallen to "historic lows," according to the Alaska Department of Labor and Workforce Development.

Typically, the opposite is true: Claims for unemployment benefits usually increase when employment goes down and the unemployment rate goes up.

But "since the fourth week of 2017, the (insured unemployment rate) has been at a record-setting low compared to the same week in any prior year," the labor department said in a report released this month. "This means the fewest people ever are receiving unemployment benefits, when adjusted for the size of the covered workforce."

So what's going on?

It's hard to know for sure, but there are several likely factors, the labor department's report said.

Perhaps some of the recession's job losses were among people who held two jobs, meaning if they lost one gig, they'd still be employed and therefore couldn't claim such benefits. Another factor may be job losses from retirements. Another could be people who quickly found new work Outside after losing a job here.

[Alaska's economy is still struggling, but the worst may have passed]

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Still, many of these factors are difficult to measure, said labor department economist Tiffany Wadel.

"We know some of these are happening, some more than others," she said, "but because we can't measure them, we can't say to what extent they're pushing claims down."

For instance, Wadel said, the labor department doesn't have numbers on how many positions are lost specifically to retirement.

Employers also might be hiring fewer people. Or, in tough economic times, maybe people who lose their job "jump into the first job they find, even if the new job is lower-paying or a poor fit," the report said. Others may feel the effort of applying for benefits isn't worth it.

People using up all their unemployment benefits but still remaining jobless also may be a factor, but that probably isn't the main cause of low claims, Wadel said. Some people may feel a stigma around applying for unemployment insurance, or not know such benefits are available to them, the report said.

[Unemployment insurance claims rise across Alaska]

The insured unemployment rate in Alaska for the last full week of November, the most recent figure the labor department has, was about 2.7 percent of the entire covered workforce.

Unemployment insurance claims have also been on the decline at the national level for years, the labor department said.

The rate in Alaska is at a low after an uptick last year driven by oil sector losses.

"We had that little bump because of oil and gas, but that kind of works its way out of the system," Wadel said. "They're on the decline as a whole."

Annie Zak

Annie Zak was a business reporter for the ADN between 2015 and 2019.

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