Michael Conroy/AP Photo
A food distribution event at the Indianapolis Motor Speedway, May 23, 2020. The Census Bureau’s Household Pulse Survey recently revealed that one in five U.S. households do not think they will be able to afford sufficient food in the coming month.
It is now a ritual, but one that threatens to dangerously mislead both the public and policymakers. Each Thursday at 8:30 a.m., the Department of Labor releases a report on the number of new claims for unemployment insurance filed during the prior week. The headlines blast out the number, comparing it to the prior week’s report.
Following the first two June releases, there was happy talk about the week-over-week declines from the extraordinary numbers in May. Of course, the “good news” in the first week of June was that new filings (including filings for the Pandemic Unemployment Assistance program, which allows gig, freelance, and part-time workers to receive benefits) fell to “only” 2.2 million, ten times the number of new unemployment claims filed one year earlier. This past week, the best that could be said was that the number of new claims held constant at that remarkable level. Yet for the Republican leadership, these reports, coupled with the fact that the official unemployment rate declined in May to “only” 13.3 percent (unofficially, the Labor Department’s Bureau of Labor Statistics admits the real number is at least three points higher), have turned into a clarion call to inaction.
But these numbers mask the economic pain that families are suffering even with the important benefits provided through the CARES Act. Put simply, millions upon millions of Americans don’t have enough to eat and can’t pay the rent. And we can see this reality clearly if we only look at the right source of data. Specifically, the little-known Household Pulse Survey should be in every reporter’s and public official’s in-box each Wednesday morning.
Put simply, millions upon millions of Americans don’t have enough to eat and can’t pay the rent. And we can see this reality clearly if we only look at the right source of data.
The Household Pulse is a weekly survey of between 75,000 and 130,000 respondents conducted by the Census Bureau, with all the rigor that the Bureau brings to such research. And it asks questions that reveal the true depth of the economic pain that the COVID-19 pandemic continues to cause, and how disparately that pain is being felt.
Based on the Household Pulse Survey results released on June 17, which examined responses between June 4 and June 9, almost one-third of all households expect to experience a loss of employment income over the coming four weeks. Fully 10 percent of American families—that’s 25 million, half of which have children at home—did not have enough food to eat in the prior week. Even more disturbing, one in five households—over 50 million in total—are doubtful that they will be able to afford sufficient food in the coming month. And of the nation’s 65,000,0000 renters, almost 20 percent were unable to pay their rent last month and an even higher percentage—close to 30 percent—doubt that they will be able to pay their rent in the coming month.
Communities of color are bearing a disproportionate share of this pain. The Pulse reveals that Black and Latino households are more than twice as likely as whites to be food insecure. Blacks and Latinos make up almost 45 percent of renters, and they are roughly twice as likely to lack confidence in their ability to pay the next month’s rent as white renters. Indeed, almost two in ten Black and Latino households report that they lacked sufficient food in the prior week, and almost four in ten lack confidence in their ability to pay the next month’s rent.
Next week, the Labor Department will release the unemployment report for June, and we undoubtedly will be treated to breathless reports about how the June rate compares to May. But to look to unemployment numbers to gauge how families are faring in this crisis is to completely misunderstand what those numbers are all about. The Bureau of Labor Statistics’ FAQs explain that it treats as employed anyone who was paid for even a single hour during the week for which data is gathered, and anyone who was not paid because they were “temporarily absent” from work (including those who were self-isolating due to health concerns). At the same time, it excludes from its definition of unemployed anyone without a job but unable to look for a new one. Therefore, the unemployment rate, by definition, understates the true situation of American families. Indeed, if in May the Labor Department had counted everyone who did not work but wanted to, it would have reported an unemployment rate over 20 percent! And that would not even count those forced to work reduced hours due to the crisis.
By contrast, the Household Pulse Survey has shown that since the crisis began, nearly half of all American families have lost employment income—either through layoffs, pay cuts, or lost hours.
What is certain is that for those who were living paycheck to paycheck and who received an Economic Impact Payment, that money will soon be spent.
Of course, the country is beginning to open up and restart idled economic activity. But the pace at which workers will be able to return to full-time work is uncertain at best. Indeed, another underappreciated Census Bureau survey—the weekly Small Business Pulse Survey—indicates that among small businesses, which account for almost half of all employment, for each of the past seven weeks the number of small businesses reducing their workforce or their employees’ hours has exceeded the number with more jobs or more hours. Even in the latest survey, covering the second week of June, almost 25 percent of small businesses reduced their employees’ hours relative to the prior week. That is almost twice the percentage that increased hours during the same time period.
What is certain is that for those who were living paycheck to paycheck and who received an Economic Impact Payment under the pandemic relief legislation (up to $1,200 per adult and $500 per child), that money will soon be spent, if indeed any is left. The law’s $600 per week increase in unemployment benefits expires at the end of July. And the support provided to small businesses to retain employees through the Paycheck Protection Program totals at most ten weeks of payroll expense. We are thus approaching a terrifying economic cliff.
In order to make the right policy decisions, we need to look to the right data. The Census Bureau’s overlooked Household Pulse Surveys make clear that the financial pulse of millions of American families, especially those of color, is already faint, even with the benefits Congress has approved. They are struggling to keep a roof over their heads and put food on the table. Reports of long lines at food banks and the desperate calls to relief organizations are anecdotes grounded in statistics at our fingertips. To ignore the Census Bureau data while trumpeting small improvements in the still-dire employment picture would ignore the economic devastation families are continuing to experience as the result of the worst pandemic in a century, and make a dire situation for millions of Americans even worse.
