The Massachusetts Fiscal Alliance made the following statement today in response to the economic report released by the Pioneer Institute on Wednesday morning.
The study was done by Greg Sullivan and Charlie Chieppo and sounded the alarm for state leaders to pay attention to the economic depression the state suddenly now finds itself in. The full copy of the study is available on Pioneer Institute’ website: https://pioneerinstitute.org/covid/report-ma-likely-to-see-sharp-spike-in-unemployment-rate/
Some of the key takeaways of the study are:
- Massachusetts unemployment could skyrocket to 25.4 percent by this June.
- Massachusetts is the sixth hardest hit state, with new jobless claims totaling 8.6 percent of its total civilian labor force.
- Massachusetts also experienced an unprecedented surge in unemployment claims, starting in the third week of March. (First week of March, unemployment was at: 4,712. Second week of March: 7,449. Third week of March: 148,452. Fourth week of March: 181,062. Total for the last two weeks of March: 329,514
- Not everyone who becomes unemployed can receive Unemployment Insurance. The Institute believes the total is closer to 575,000. For Q1 of 2020, the Institute estimates it could be near 681,526.
- During the great recession, Massachusetts income tax revenues declined from $12.5 billion in FY2008 to $10.6 billion in FY2009, a drop of $1.9 billion. They declined further to $10.1 billion in FY2010, a drop of $2.4 billion from the FY2008 level. During that recession, Massachusetts unemployment rose from 4.6 percent in FY2007 to a high of 8.3 percent in FY2010.
“The Pioneer study should be considered by every state leader moving forward. The decisions they make now will have profound effects on our future economy. It’s the canary in the coal mine and a clear warning to our state leaders that a tsunami is coming if they continue to ignore the issue,” stated Paul D. Craney, spokesperson for Massachusetts Fiscal Alliance.
“Many of the COVID19 policies are designed to protect Massachusetts residents of the virus but today’s study should warn state leaders that they need to focus on tightening their belt and our economic well-being. The good news is that they have yet to pass a budget for the upcoming fiscal year, which means there’s still time to implement some fiscally responsible, pro-growth policies to set us on the right track,” finished Craney.