Unemployment claims higher than expected
Good Day Chicago FOX32 interviewed Arena CEO Michael Rosenbaum 8-22-20 – video here.
ELIZABETH MATTHEWS: More than 1.1 million people filed new Unemployment Claims last week. That’s 200,000 more people than expected. Economists had believed the number of claims would fall for the third week in a row. So how is Chicago faring? Joining us now to talk about this former White House economist and CEO of Arena, Michael Rosenbaum. Welcome. And good morning, Michael. How are you?
MICHAEL ROSENBAUM: I’m good. Thanks again for having me.
MATTHEWS: Of course. Well, it is a tough time for so many Americans, unemployment benefits expiring earlier this month. How does Chicago look when it comes to our unemployment numbers?
ROSENBAUM: The bottom line – like lots of areas of the country – is that it’s devastating. Unemployment in Chicago is 19%. So you’re talking about massive unemployment rates. Obviously, as some of the additional supports have subsided, things have gotten worse. But at the same time, when we look at the economy as a whole, there are sectors that are shrinking dramatically, such as hospitality. But at the same time areas like healthcare are actually hiring aggressively.
ROSENBAUM: So the business that I run – Arena – is deployed primarily in healthcare and is predicting the likelihood someone’s going to achieve an outcome in a job. Arena’s clients are national, and nationally about 17% of the US healthcare workforce. In the Chicago area, Arena is deployed into 90 healthcare facilities. And in those facilities, they have hired 20% of their workforce they had as of April 1st, since April 1st. So that’s substantial hiring going on in the last few months.
MATTHEWS: So how does Chicago fare with other cities you said 20% here in our healthcare industry, is that kind of what we’re seeing nationwide?
ROSENBAUM: It varies, frankly, from metro area to Metro area. Chicago, I would say was probably on the higher end. But also Chicago is on the higher end of dislocations of other markets because Chicago has a pretty robust tourist industry.
Tourism, obviously, has taken a massive hit nationally and globally. And so in the Chicago area, I think we see increased devastation to the tourism industry, while at the same time perhaps some increased hiring in the healthcare industry.
MATTHEWS: I see the jobless claims jumped this week, kind of unexpected. It seemed like it was kind of going down. Do you have any inclination of why that was caused?
ROSENBAUM: I think that anyone who tells you that they can tell you what unemployment rates are going to do from week-to-week, month to month, is wrong. The bottom line is that there are fluctuations going on in COVID rates. And as a result, there’s fluctuations going on in employment bases in different sectors of the economy. I think, over the next few months, we’re just going to see volatility. The way we would describe it normally is confidence intervals. Those confidence intervals are very large. They could go up by a million, they could go down by a million.
But the bottom line is that the economy is clearly devastated, clearly devastated. And that we’re going to continue seeing that for some time.
MATTHEWS: Gotcha. And Arena, you guys are really busy right now, I would presume.
ROSENBAUM: We are very busy. So Arena actually has grown its footprint by over 70% since April 1. Because what Arena, at its core, is doing is, by figuring out who’s going to achieve an outcome in a job, we are figuring out when someone may be let go from a job in retail or in restaurants or in a hotel, if they’d actually be fabulous as a manager of a maternity ward in a hospital or working in a skilled nursing facility in a leadership role or on the line. I think, normally, you wouldn’t see quite so much movement across industries. But right now we’re seeing very dramatic movement across industries. And as a result, what Arena is doing is helping folks move across industries.
MATTHEWS: What an interesting concept. Well, thank you so much for joining us, Michael. For more on what Michael does head to the Arena website.