Jobs wanted: Unemployed workers are losing coronavirus relief money. Can the economy support them?
STEAMBOAT SPRINGS — A series of presentations on the state of the local and broader economy at the Routt County Board of Commissioners on Tuesday revealed few surprises for the county leaders, but just as scant was the amount of good news amid the COVID-19 pandemic.
Unemployment is up. The job market is down. Uncertainty and instability continue to be gloomy clouds obfuscating any sort of concrete understanding of what the coming weeks and months will bring.
But after weeks and months of the same, these announcements appeared to elicit fewer feelings of doom and gloom than somber resolve at continuing a path to recovery, however slow. There was a sense among the commissioners and those chiming in at the virtual Zoom meeting that the county already has survived the worst of the crisis and is ready to dress the wounds and face whatever else comes its way.
But first, the bad news
When it comes to the local economy, it’s hard to find enough sugar to coat the state of things into something that resembles sweetness.
Routt County has the ninth-highest unemployment rate in Colorado at 13.1%, according to Jessica Valand, regional director for workforce development in Northwest Colorado. This is worse than the state average of 10.3% unemployment, though Valand anticipated such a discrepancy.
Resort-based communities have been among the hardest hit when it comes to job loss amid the pandemic, she explained. The counties with the worst unemployment rates, Gilpin and San Miguel, rely heavily on casinos and other tourist-based gaming activity that continue to operate at a fraction of normal due to public health restrictions.
While the pressure is on for people to return to work, the job market is not nearly as robust as before the pandemic.
The federal Pandemic Unemployment Compensation, or PUC, gave unemployed workers an extra $600 per week on top of state benefits. It expired last weekend, and Congress — Republicans in particular — are wary of renewing any additional funding because they say it discourages people from looking for jobs.
To note, people on unemployment have to prove they are regularly searching for new jobs to keep their benefits. During the shelter-at-home order, Colorado temporarily removed this requirement to allow people to remain isolated.
It is true that many of the unemployed workers have been making more than they would have otherwise, which has made some reluctant to take a new job. Most of the positions that are hiring across Routt County, in the food and retail industries for example, are ones that pay below the county’s average wage. Then there is the concern of getting COVID-19 while working a front-facing job like bartending or sales.
At Mountain Tap Brewery, owners Wendy and Rich Tucciarone have been short-handed and struggled to find people who want to work. On occasion, an employee must undergo a precautionary quarantine due to contact tracing, which further limits available staff. Last weekend, their teenage son had to lend a hand to keep up with customers, Wendy said.
“Lots of people just don’t seem to want to come off unemployment insurance,” she added.
The problem, as Valand explained during the presentation on Tuesday, is that even if everyone really did want to find a job, the economy has not recovered enough to offer a large enough job market to absorb the number of people who filed for unemployment during the pandemic. The latest numbers her workforce agency pulled showed about 500 job openings for more than 2,000 unemployed people in the county.
“The unfortunate reality for us is we have four to five times as many unemployed people as we have available jobs in the county,” Valand said.
That means people struggling to look for jobs are dealing with the added issue of not having as much income through federal assistance. For the average unemployed resident in Routt County, the PUC money represented about two-thirds of his or her weekly income — the average state assistance is $330 per week — according to Valand. In total, the PUC program brought an estimated $817,800 per week to the local economy that has since disappeared.
The decrease means those people will be more likely to struggle affording even basic necessities. It also means less revenue for local businesses, which already have seen hits to their profits, according to Valand.
This issue is not unique to Routt County. A recent survey from the U.S. Census Bureau found nearly 11% of Americans live in a household without an adequate amount of food to eat. More than 25% of respondents have missed a rent or mortgage payment.
A recession alphabet
The COVID-19 pandemic instigated a global decline in economic activities. A report from the World Bank says the crisis could lead to the worst recession since World War II.
When economists describe a recession, they typically graph the trajectory using one of four letters: V, U, W and L. For example, the Great Recession followed a V shape, in which economic activity suffered a sharp decline but was able to rebound at a slow but steady pace.
John Bristol, economic development director for the Steamboat Springs Chamber, calls this the “alphabet of economic recovery.” While the effects of the current crisis will be clearest in hindsight, the current state of things is largely indicative of an L-shaped recession, according to Bristol. Economic activity plummeted in a matter of days following the statewide stay-at-home order in March, and there has been little improvement in growth since.
It remains unclear how long the downturn will last, but businesses and consumers alike tend to believe it will take until next year to fully recover. Consumer confidence dropped steeply in March and April, though it has been slowly improving.
The Leeds Business Confidence Index from the University of Colorado Boulder showed more optimism among business owners across the state than the previous months, but the majority do not anticipate seeing sales or employment numbers returning to pre-pandemic levels until 2021 at the earliest. Five percent of the businesses surveyed do not believe job levels will ever return to normal.
With that in mind, Bristol said the focus locally should be on retaining economic activity and protecting businesses. The Steamboat Chamber has been in regular contact with the various industry groups around the city to learn about their needs and communicate those to local government.
In recent weeks, an increase in tourism to Routt County has helped spur revenues as families look for an escape from cramped urban areas, Bristol said. Creative solutions for businesses, such as expanding restaurant seating onto sidewalks and streets, also help.
But as the end of summer nears, some of these solutions will no longer be viable. Restaurant capacity will take a hit as snow and plummeting temperatures make eating outside intolerable. Confusion around how the school year will operate has parents fumbling to solidify their work plans. All of this creates uncertainty, a word that makes economists like Bristol pale in the face.
Signs of hope
With more people in Steamboat, businesses have been enjoying what prosperity they can find. Wendy Tucciarone said July revenue is down compared to last year but better than she had anticipated. She is more concerned with following health protocols and keeping her staff and customers safe.
“We recognize that we just need to get to the other side of this, and whatever it takes to get there will be worth it,” she said in an email.
Patrick Keogh, sous-chef at Mambo Italiano, said the restaurant recently returned to being fully staffed after working for months with a skeleton crew. His salary, which was cut 10% at the start of the pandemic, has since gone back to normal. Owner Hannah Hopkins also sets aside a portion of tips to help less fortunate employees have an emergency fund.
For others struggling to make ends meet in Routt County, local government and nonprofits offer a variety of services to help residents navigate financial hardship.
Another presenter on Tuesday was Kelly Keith, director of the county’s Department of Human Services. Since the start of the pandemic, her office has been busy working with an influx of clients searching for unemployment benefits and food and medical assistance. For the months of March and April, she received more than double the usual number of applications, many of which came from people needing immediate help who could not afford food to last the week.
With the PUC money going away, Keith expects another surge of demand for human services. Her office will open its doors to in-person meetings with clients starting Monday, the first time since the start of pandemic restrictions in mid-March.
A newly available program for families in need is called Colorado Works. It provides either a one-time payment or ongoing assistance, whichever is most helpful to a particular household. It also helps people find job opportunities and manage finances. The state has expanded eligibility for the program to allow more families to participate. For information about this and other welfare opportunities through the county, call 970-879-1540.
Nonprofits like LiftUp of Routt County and Integrated Community continue to offer services, such as housing and food assistance to buttress the county programs.
For those who are struggling with the job search, the Colorado Rural Workforce Consortium offers employment advice and job retraining help. Among the top industries currently hiring are health care; computer sciences; transportation; and trade work, such as construction and plumbing, according to Christian Oxley, the consortium’s business services coordinator.
As the pandemic wears on, Congress is debating further coronavirus relief funds. Democrats are pushing for another $3 trillion stimulus package that would bring back the $600 per week payments. Republicans are proposing a smaller, $1 trillion package that would decrease the weekly checks to $200.
Government leaders and businesses continue to search for ways to bring a greater sense of normalcy to the economy. Limits on gathering sizes and social distancing complicate these efforts, with a vaccine one of the best but unforeseeable solutions.
Of course, ramping up economic activity comes with the risk of spreading the novel coronavirus. A large enough resurgence of cases could have the ironic consequence of yet another shutdown, eliminating what progress the country made.
One must not forget that behind the stock markets and financial projections are people worried less about their wallets than the lives of those they love, just wanting — for themselves and their families — to survive.
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