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Economists: Phased Reopening Of States Has Helped Unemployment Numbers

PITTSBURGH (KDKA) -- The new federal unemployment numbers are in. May saw a drop to 13.3% after being at 14.7% in April.

Experts believe one of those factors that helped the unemployment rate was the phased reopening of the states.

Fancypants Popcorn finally got to open their Lawrenceville location this week.

They had planned to open in March but the pandemic changed that.

"Couldn't finish inspections. Couldn't get an occupancy permit," Jared Welty said outside the shop.

They have about 12 employees for two stores, but only five are working right now.

"We're doing the bare minimum right now and trying to cover as many of the bases ourselves," Jared Welty said.

The unemployment rate is down from April, but Duquesne University's Department of Economics and Finance Chair Dr. Risa Kumazawa said there are several industries where people are making more on unemployment than at work.

"If you're making more not working [and] collecting benefits, then you are more likely to do so," she said over a Zoom interview.

So, places like Fancypants Popcorn are working with their employees to try and get them hours as they still receive partial unemployment benefits.

"At the same time, these people want to get out too. So getting out of the house is also a draw, so it's treading that line very carefully," Welty said.

Other stores like Wagner Quality Shoes aren't seeing that issue but a few employees are home because they are at risk for the virus.

"Being part of the family, we are really fortunate to have such loyal employees," member of the owning family Mark Wagner said.

As for our local unemployment rate, Dr. Kumazawa expects it to be slightly higher than the national rate since Pennsylvania has had a higher rate of jobless claims. She also said factors like discouraged workers are not taken into account in the unemployment rate. They are people who were looking for work and stop. That number has continued to grow since March.

"So there are indications that everything is not necessarily rosy just because the unemployment rate has gone down," she said.

For stores, they hope as more places open and more people go back to work, business districts will start to see more foot traffic.

"With things going to green, I think we will see an uptick with some of that traffic so we're excited," Wagner said inside his Lawrenceville store.

Another economist from Point Park University, Dr. Dorene Ciletti, expects the local unemployment rate to be about the same as the national. She feels as long as businesses can safely reopen, it could a trend in the right direction.

The official numbers for the state come out later this month.

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