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Wisconsin Unemployment Rate Drops To 12 Percent

But Hundreds Of Thousands Remain Jobless

Unemployment insurance claims office
Bytemarks (CC-BY)

Wisconsin’s unemployment rate was 12 percent in May, a slight improvement from the month before, but still a historically high number as hundreds of thousands remained jobless in the early months of the COVID-19 pandemic.

The slight dip in Wisconsin’s unemployment rate, which was down from a 13.6 percent revised unemployment rate in April, did not come as a total surprise. The national unemployment rate, which was released earlier this month, dipped to 13.3 percent in May, down from 14.7 percent in April.

Overall, Wisconsin’s Department of Workforce Development (DWD) reported that Wisconsin gained 74,900 jobs between April and May, including 72,100 private sector jobs.

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But compared to the same month last year, total employment was down 387,700 jobs, including 338,100 jobs lost in the private sector.

“The numbers that we see here in the last month have confirmed that it’s still serious, it’s still severe, but we’re making some progress,” said DWD Chief Economist Dennis Winters.

The numbers released Thursday offer an imperfect snapshot of Wisconsin’s economy as it loosened social distancing restrictions that were first handed down in March.

The Wisconsin Supreme Court struck down the state’s “Safer at Home” order on May 13, but some counties, namely Milwaukee and Dane, imposed their own restrictions and have reopened more gradually.

Complicating that picture is the way the unemployment data is calculated. It comes from a monthly survey of households that was conducted last month on the week of May 12. That means some of the survey was conducted while the stay-at-home order was in place, and some of it was conducted after the order was lifted.

Winters said the slight dip in the national unemployment rate hints that Wisconsin’s rate might also drop. He said Wisconsin’s rate likely remains low because of the state’s diverse economy, including its manufacturing sector.

Earlier this year, Winters had estimated that the state could hit 27 percent unemployment based on the number of initial claims that people were filing. He indicated Thursday that was no longer likely.

“Now that we’re headed the other way, I would say certainly in the short term that that’s going to be unlikely,” Winters said. “So we’re feeling pretty good about that.”

Winters declined to speculate on whether local social distancing was slowing job growth, saying local unemployment numbers due out next week would shed light on that.

The surge in unemployment this year has stressed the state’s unemployment system in recent months, leaving many workers waiting several weeks to receive benefits. The state has been transferring employees from other agencies to handle unemployment claims.

Initial unemployment claims continue to pour in at much higher levels than they did a year ago, although they have subsided significantly from the earlier days of the COVID-19 crisis, when tens of thousands of Wisconsin residents were filing for unemployment on a daily basis.