Travis County's unemployment numbers will worsen without long-term federal help, experts say

 (Christopher Neely/Community Impact Newspaper)
(Christopher Neely/Community Impact Newspaper)

(Christopher Neely/Community Impact Newspaper)

Recently released unemployment data for July showed Travis County posted a single-digit jobless rate for the second consecutive month, welcome news for a region that saw double-digit unemployment rates as the pandemic took hold in April and May.

Since hitting 12.4% in April, Travis County’s jobless rate has consistently dropped each month to 6.9% in July, according to the Texas Workforce Commission; however, experts said they expect the job recovery to at least plateau, if not worsen, absent a new stimulus bill from U.S. Congress and long-term financial assistance from the federal government.

Jon Hockenyos, the president of the local economic analysis firm TXP Inc., said jobless trends were only “sort of” encouraging since the federal government’s payroll protection loans for businesses and the enhanced unemployment program that sent an additional $600 per week to unemployed Americans have dried up with no long-term solution from Congress in sight.

“It’s going to be hard to see the recovery continue,” Hockenyos said. “There is no doubt in my mind the level of consumer spending and the job support associated with that is because of the substantial injection of $600 per week and the companies that received [Payroll Protection Program] loans. Consumer spending will take a hit, and unemployment won’t get better.”

In April, Hockenyos told Austin City Council that he expected the region to see a substantial recovery in the job market by December. Now, he said that forecast is “not happening.”

Although a 6.9% unemployment rate shows some recovery, it is still much greater than the 2.6% jobless rate Travis County saw in February, before the coronavirus began to spread locally.

“We’re trending in the right direction, but we’re not out of the woods yet,” said Tamara Atkinson, the CEO of the Workforce Solutions Capital Area, the local arm of the Texas Workforce Commission.

Workforce Solutions aims to connect local residents with jobs and job training. Atkinson said the federal government’s additional $600 per week provided a “lifeline” for many workers, and without it, she expects to see a “hockey stick incline” in the requests for Workforce Solutions’ services.

Atkinson said she was especially concerned about self-employed gig and contract workers. Although they received help under the federal government’s program, they did not qualify for unemployment insurance from the state and stopped receiving payments when the federal money dried up in late July.

“We’re missing a huge swath of our workforce that we know is suffering,” Atkinson said.

Amid congressional deadlock over the next pandemic stimulus bill, U.S. President Donald Trump signed an executive order Aug. 8 that provides a stopgap solution for unemployed Americans. The order allows states to apply to receive money from the Federal Emergency Management Agency to add an extra $300 per week in federal funds to unemployment checks for state residents. States are allowed to contribute an additional $100 per week from its own funds.

On Aug. 21, Texas was approved to receive the unemployment help but will not tack on the additional $100. Unemployed Texans who qualify will also receive $300 per week for the weeks in August before the federal program was approved, from Aug. 1 forward.

Hockenyos called the measure “good” but said if it only lasts a few weeks, it is not going to make much of a difference, only delaying a worsening reality for the American economy. Absent a vaccine or successful treatment for the coronavirus, Hockenyos said it is crucial that Congress figure out a long-term solution.
By Christopher Neely
Christopher Neely is Community Impact's Austin City Hall reporter. A New Jersey native, Christopher moved to Austin in 2016 following years of community reporting along the Jersey Shore. His bylines have appeared in the Los Angeles Times, Baltimore Sun, USA Today and several other local outlets along the east coast.


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