April 2020 unemployment data was released this week for the nation and the numbers were as expected.
All three counties in the Golden Triangle experienced substantial spikes in unemployment percentages. Pictured in the charts is some information detailing what changes we’ve experienced as a region.
While these numbers are expected to rebound back to lower averages in the coming months and year, it is likely that we will see unemployment information in the news for much longer. In an effort to help all of us better understand what is reported in the news and by agencies, we’ve listed some frequently used terms below. These terms and explanations are sourced from the Society of Human Resources Management.
Layoff – A layoff is generally considered a temporary separation from employment due to a lack of work available for some temporary period. The term “layoff” is mostly a description of a type of termination in which the employee holds no blame. Most workers who experience layoffs are eligible for unemployment benefits.
Furlough – A furlough is a mandatory temporary leave or reduction in hours where an employee remains an employee of the company. Furloughs are often used when there is limited cash for payroll (e.g. government shutdowns) or there are simply not enough available workers to warrant staffing a shift (e.g. manufacturing furloughs due to COVID-related absences). Employees may continue to receive benefits coverage during a furlough and may also, if eligible, receive unemployment benefits during the furloughed period even though the employer continues to provide health case insurance and other benefits.
Unemployment Insurance – The U.S. Department of Labor’s unemployment insurance programs provide unemployment benefits to eligible workers who become unemployed through no fault of their own and meet state eligibility requirements. Each state administers its own unemployment insurance program, and most employers pay state and federal unemployment tax to fund these benefits.
Unemployment Benefits – In Mississippi, if a person qualifies for unemployment benefits assistance, he or she is eligible for up to a maximum of $235 a week for 26 weeks, under normal regulations. The CARES Act extended that time frame by 13 weeks making a person eligible for unemployment for 39 weeks.
Unemployment Booster ($600) – Various names are used to describe the additional $600 unemployment booster that is currently provided by the Federal Pandemic Unemployment Compensation program that was put in place as part of the CARES Act. This program is set to expire in July.
Regardless of position or party, a few important points are worth noting about unemployment assistance.
First, when an employee files a claim for unemployment benefits, the claim is attached to a particular position at his or her place of employment. If a business reopens and recalls that person back to work to assume their previous job, the business is legally required to report the recalled position and employee to the Mississippi Department of Employment Security (MDES). MDES then ceases further payments unemployment benefits to the recalled employee. If the person receiving benefits declines to resume their position, their unemployment benefits will stop nonetheless (although it may take 1-2 weeks for benefits payments to cease).
Second, unemployment benefits are subject to state and federal income tax, including the extra $600 federal booster. A person receiving unemployment benefits can fill out a Form W-4V and request that the MDES withhold taxes, avoiding a surprise tax bill next year. Regardless of whether a person elects to withhold taxes from each unemployment benefits check or waits to see what taxes need to be paid when filing next year, getting some help from a professional to look at your withholdings is a good idea so that there are no surprises on April 15, 2021.
The bottom line is that our nation is facing record setting unemployment levels and our state and region are no exceptions. Moving forward, job revitalization and job creation will prove challenging, but not impossible, as we race back to a healthy economy and maintain a healthy population. Our region has displayed creativity and resiliency thus far, and we have faith those same traits will carry the Golden Triangle into the post-pandemic future.
Macaulay Whitaker is the chief operating officer for the Golden Triangle LINK.
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