Initial claims rose substantially in California during the week of February 6 while dropping in the rest of the US.

In California, initial claims processed in the regular program were up 21.6% compared to the prior week, while processed PUA claims were down 22.5%. The rise in regular initial claims outweighed the drop in PUA claims. In the national totals, regular claims eased 4.3%, while PUA claims dropped 9.3%. Combined, total claims processed rose 8.4% in California while easing 5.8% in the US.

The latest week’s results continue to keep California’s trend above the other states which have seen a gradual easing of total initial claims over the past 4 weeks.

With the stay-at-home orders lifted on January 26, the state’s underlying Tier restrictions remain the core determinant in when jobs can resume, especially those for the lower wage workers that have been the hardest hit by the state’s chosen strategies. The most recent tier allocations for the week of February 9 from Department of Public Health show only one change in the Tier designations, with Del Norte County moving from Tier 1 to Tier 2. Virtually all of the unemployed from the December numbers continue to be in counties under the most restrictive Tier 1 provisions. Movement out of those restrictions—either through shifts in tier status or revision of the tier restrictions better reflecting ongoing improvements to the risk data—and consequently the reopening of jobs will be essential for the state to move to recovery.

The chart above is based on the 1.7 million workers officially classified as unemployed in December. Adding in those leaving the labor force raises the total closer to 2.3 million.

While remaining below the US average, California continued rising in its vaccination rate, moving from 17th lowest among the states to 19th in the most recent data from Centers for Disease Control. New vaccinations began to keep pace with new supplies received by the state, with 1.463 million injections given over the past week compared to shipments of 1.478 million new doses. Continued lagging in the injection rate is particularly critical as the state’s COVID strategies produced the 3rd worst employment loss rate among the states in the December data, along with 13 of the 25 MSAs (out of 389) with the worst unemployment rates in the country.

The unemployment insurance backlogs climbed in the most recent data from EDD. Backlogged continuing claims as of February 3 were up 72% from the prior week. Backlogged initial claims rose another 4%, primarily due to “waiting for claimant certifications,” but ‘resolving other eligibility issues” is behind an increasing share of the rise. Combined, total backlogged claims were at 1,028,684, or 6% higher than the prior week. EDD defines backlogged initial claims are defined as those "applications for benefits that take more than 21 days to issue a first payment or to disqualify the individual, regardless of if the claimant or EDD need to take some kind of action." Backlogged continuing claims are defined as a "subset of all individuals who received at least one payment and are now waiting more than 21 days for further processing of payment or disqualification."

In the most recent data from EDD, California paid out a total of $118 billion in benefits under all the UI programs in the period March 7 through January 30. The most recent estimate is that up to $31 billion of this amount was paid out to fraudulent claims, consisting of $11 billion in known fraud and up to $20 billion in suspected fraud. The $118 billion amount also does not account for the additional $300 a week in enhanced benefits authorized under the federal pandemic relief bill passed in the December. Unemployed workers were eligible for these enhanced benefits beginning December 27. California workers will not be receiving the enhanced amounts until at least the beginning of March due to administrative problems at EDD.

The most recent data from US Department of Labor indicates California’s outstanding loans from the Federal Unemployment Account were $18.8 billion, or 39% of the total amount owed by 19 states. This amount does not include accumulated interest which under the second COVID relief bill is currently waived through March 14. Other rarely used provisions in federal law also allow the state to schedule payment on the interest over a three-year period.