Speaking at the U.S. Conference of Mayors’ winter meeting, President Joe Biden botched a statistic on the number of people receiving unemployment benefits, misidentifying them simply as the number of people “out of work.” His comment leaves the false impression that unemployment declined by more than 16 million people on his watch, when the decline was actually under 5 million.
And a big reason for the large decline in unemployment benefits is the expiration of pandemic-related expansions of such benefits.
“Two years ago this week, 18 million people were out of work — two years ago this week,” Biden said at the conference on Jan. 20. “Now the — that number is under 1.6 million, near the lowest level in decades.”
The White House transcript notes that the line drew applause.
But it’s not accurate. According to the Bureau of Labor Statistics, the number of people “out of work” — or officially unemployed — in the U.S. in January 2021 was about 10.2 million, and the number in December 2022 was 5.7 million.
A White House spokesperson told us Biden was referring to the number of people receiving unemployment insurance benefits. And he noted that Biden was including pandemic unemployment insurance programs. By that measure, and with those caveats, the statistic cited by the president would be nearly accurate (although we would note the number has crept up from 1.6 million in mid-December to 1.9 million by Dec. 31, the latest data now available).
Assistant White House Press Secretary Michael Kikukawa told us Biden was simply using “shorthand for something that is true,” and that on at least two occasions — in remarks in early December and in a tweet on Jan. 25 — Biden has “more fully contextualized” his comments by noting that he was talking about the number of people claiming unemployment benefits.
Biden may have simply been careless in his wording of the statistic before the U.S. Conference of Mayors, but the Department of Labor explains on its website that it is a common public misconception to confuse the two metrics.
“Some people think that to get these figures on unemployment the Government uses the number of persons filing claims for unemployment insurance (UI) benefits under State or Federal Government programs,” the Department of Labor says on a webpage dedicated to explaining the difference between the two. “But some people are still jobless when their benefits run out, and many more are not eligible at all or delay or never apply for benefits. So, quite clearly, UI information cannot be used as a source for complete information on the number of unemployed.”
Among the unemployed who are not covered by UI programs are “self-employed workers, unpaid family workers, workers in certain not-for-profit organizations, and several other small (primarily seasonal) worker categories,” the Department of Labor explains in a Frequently Asked Questions webpage. Also not eligible are unemployed people whose UI benefits have run out; workers who have newly entered the workforce and have not yet earned UI benefits; workers disqualified from UI because they lost their jobs “from their own actions rather than from economic conditions,” such as being fired for misconduct; and people who would qualify for UI but simply do not file for benefits.
“Because of these and other limitations, statistics on insured unemployment cannot be used as a measure of total unemployment in the United States,” the Department of Labor states. “Indeed, over the past decade, only about one-third of the total unemployed, on average, received regular UI benefits.”
Indeed, the number of people “out of work,” or unemployed by the Department of Labor’s definition, was 225% higher in December than the figure Biden cited. On the other side of Biden’s comparison, the number of unemployed people in January 2021, when Biden took office, was significantly lower than the number receiving unemployment benefits (the figure Biden used), and we’ll explain why.
Unemployment Insurance Claims
The total number of people getting unemployment benefits was steadily holding at about 2.1 million per week in January, February and the first couple of weeks of March 2020, right before the pandemic changed everything. Between the weeks ending March 14 and March 28, the number of people receiving unemployment benefits nearly quadrupled to 8.3 million. And it rose steadily for months after that, reaching a high of 33.2 million the week of June 20. (To see the total number receiving UI benefits, including pandemic programs, go to the Department of Labor’s webpage on “Unemployment Insurance Data.” Click on “Benefits and Claims” and then “UI Weekly Continued Claims — All Programs.”)
As the Bureau of Labor Statistics explained in September 2021, claims for unemployment benefits “rose sharply” during the height of the pandemic “because of the substantial job loss” but also because of “the expansion of UI programs.”
The federal government expanded UI benefits through the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, which was signed by President Donald Trump on March 27, 2020. As the Department of Labor explains, among other things, the CARES Act “expand[ed] states’ ability to provide unemployment insurance for many workers impacted by the COVID-19 pandemic, including for workers who are not ordinarily eligible for unemployment benefits.” Pandemic Unemployment Assistance, or PUA, for example, was offered to the self-employed and those seeking part-time work.
“To qualify for PUA benefits, you must not be eligible for regular unemployment benefits and be unemployed, partially unemployed, or unable or unavailable to work because of certain health or economic consequences of the COVID-19 pandemic,” the Department of Labor explained.
The law also extended the maximum number of weeks a person could receive unemployment benefits, through what was called the Pandemic Emergency Unemployment Compensation, or PEUC, program. “Importantly, the CARES Act gives states flexibility in determining whether you are ‘actively seeking work’ if you are unable to search for work because of COVID-19, including because of illness, quarantine, or movement restrictions,” the Department of Labor noted.
The week Biden took office in January 2021, the number of people receiving UI benefits through the PUA and PEUC programs was 11.5 million, accounting for nearly two-thirds of all UI recipients. That explains how there were some 8 million more people receiving UI benefits in January 2021 than there were unemployed people, according to the Bureau of Labor Statistics.
In March of that year, Biden signed the American Rescue Plan Act, which extended the PUA and PEUC programs until Sept. 6, 2021. Some people receiving PUA and PEUC benefits continue to show up in small numbers on weekly reports, because claims are still being processed. But those two sources of UI benefits largely ended in September 2021. As a result, the total number of people getting UI benefits went from 12.1 million the last week of August 2021 to 3.3 million the first week of October 2021, a month later.
So a lot of the drop cited by Biden has to do with the expiration of UI benefits that were expanded because of the pandemic, which has since waned. Kikukawa, the White House spokesperson, also makes the case that “we were able to phase out those pandemic programs precisely because they weren’t needed anymore thanks to our historically strong recovery.”
According to the most recent data available from the last week of December, the total number of people getting UI benefits was 1.9 million. The number has been trending in the wrong direction since the week of Oct. 8, when it was just over 1.2 million. But even at 1.9 million, the number of people getting UI benefits is low, historically speaking. It was a bit higher in the first two months of 2020, just before the pandemic hit, but it was lower every week from the week of March 30, 2019, to the week of Dec. 21, 2019. And it was about the same or lower in parts of 2015, 2016, 2017 and 2018.
Calculating the Unemployed
As we said, the number of people receiving UI benefits is a very different statistic than the estimated number of unemployed people in the U.S.
According to the Bureau of Labor Statistics, “[p]eople are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work.” Actively looking for work includes such things as conducting job interviews, submitting resumes or filling out job applications.
The estimated number of unemployed people in the U.S. is based on data collected in a monthly survey — called the Current Population Survey — of over 60,000 households and conducted by the U.S. Census Bureau.
In that survey, a person only officially counts as “unemployed” if they are out of work and say they are available for work and also say they have looked for work at least once in the past four weeks. BLS also keeps track of other “alternative measures of labor underutilization,” which includes “marginally attached workers,” people who say they would work and have looked for work in the past year, but not in the past four weeks; and people who are “part-time for economic reasons” (sometimes called “under-employed”), which includes people who say they want to work full time but have had to settle for part-time work. Obviously, the number of unemployed increases if those kinds of categories are included.
But as we said, the official number of unemployed people in the U.S. was 5.7 million in December. That’s a 44% drop since Biden took office. The number of unemployed had already dropped 56% in nine months prior to Biden taking office.
The number of unemployed people in December is low, historically speaking. The number was almost exactly the same – technically slightly lower — in February 2020 under Trump, right before the pandemic hit. It was also lower in several months of 1999 and 2000. But as we said, although not the lowest, the number is comparatively low in recent history. The average monthly number of unemployed going back to 2000 is 9.2 million.
It’s just not as low as Biden’s claim would leave people to believe. Biden said that two years ago, there were 18 million people “out of work” and now “that number is under 1.6 million.” The number of unemployed Americans was much lower than that two years ago, and it is much higher than that now.
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