As claims for unemployment insurance pour into state offices, the state has just a bit under $2 billion socked away to make payments to jobless workers.
But nobody knows if that’s really a lot of money. It depends how many Nevadans lose their jobs, and for how long. Economists expect that Nevada workers will be among the hardest-hit in the nation during this downturn.
An explosion of claims for unemployment payments — 92,298 in all — were filed in Nevada in the week that ended March 21. To put this into perspective, it exceeds the previous record by 83,353. The old record, 8,945, dated from January 2009, just when the Great Recession began to arrive.
To pay unemployment claims, the state has been socking away tax payments from employers. The trust fund that pays jobless claims stood at $1,975,556,381 on March 20. The figure changes daily as new payments from employers roll in, and checks to jobless workers roll out.
Given the fluid situation, the Nevada Department of Employment, Training and Rehabilitation won’t even hazard a guess how long the money will hold out. But within the last month, the amount in the fund declined by about $15 million.
During the last recession, the state fund ran out of money. Nevada borrowed $801 million from the federal government to make unemployment payments, money that it needed to pay back when the economy perked up. At the start of the last downturn, the state had about $816 million socked away in the unemployment trust fund.
How bad could things get?
The Economic Policy Institute, a left-leaning Washington think tank, estimated a couple of days ago that the unemployment rate in Nevada could reach 19.7 percent by July. As recently as February, the jobless rate statewide stood at 3.6 percent. In the Reno area, it was even lower — 3.2 percent.
The state will be particularly hard-hit in coming months because travelers need to stay home during the coronavirus outbreak, the Economic Policy Institute noted. Casino, hotel and restaurant employees, who account for more than 40 percent of Nevada’s workers, don’t have the option of teleworking.
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