It is that day of the week. The usual Thursday unemployment and jobs reports are out and covered below. Tax credits and federal relief funds wrap up today’s update.
Unemployment Claims Down, PUA Apps Up
A total of 1.3 million people applied for initial unemployment claims for the week ending on July 4. This was a decrease of about 125,000 people from the week before. However, 42,000 people applied for the Pandemic Unemployment Assistance program during the same time. This total program number has now hit 1 million individuals that come from the gig economy, freelancers, and the self-employed. Increases are largely attributed to the recent spike in cases throughout the west and south. Since the pandemic began, more than 45 million Americans have lost their jobs and filed for unemployment insurance at some point.
Illinois Teens and Jobs
Teenage job seekers in Illinois have been hurt by COVID-19 far worse than their peers in other states. Specifically, just 15.9% of those aged 16-19 had a job in April and May of this year. Only neighboring Indiana was even close, with 22.4% in that age group employed this spring. Next was Missouri, at 26.3%, and Michigan and Ohio, each at 26.9 percent.
The Illinois figures are particularly low when compared to April/May of 2019, when 26.7% of teens were employed. That makes the year-over-year drop 40.4% which is the worst among the Midwestern states. Between January/March and April/May, the teen unemployment rate in Illinois leapt from 11.8% to 43.4%. In comparison, the national rate went up far less, moving from 13.1% to 31.4%. One other cause to think about in addition to the pandemic is the rise in minimum wage this past January and again here on July 1.
Employer Tax Credits
In response to the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the IRS developed Form 7200 as a method for employers to request an advance payment of eligible tax credits for qualified sick leave wages, qualified family leave wages, and the employee retention credit.
The IRS will issue paper checks to taxpayers after processing Form 7200. No further action is necessary. Taxpayers will receive Letter 6312, Form 7200 Response, if the IRS either rejects their Form 7200 or made a change to the requested amount of advance payment due to a computation error. Letter 6312 will inform taxpayers of the reason for the rejection or adjustment to the payment amount.
If a taxpayer’s Form 7200 was rejected, then the taxpayer will need to review the rejection reason on the letter to determine if it is possible to file a new form. If a computation error was made, then the letter will explain why the amount of the credit received is different from the amount requested on the form. Taxpayers may claim a credit for qualified sick leave wages, qualified family leave wages, or the employee retention credit for which they are eligible, on their applicable employment tax return for the applicable tax period in 2020. Taxpayers cannot correct or amend previously submitted Forms 7200.
Taxpayers who have questions about their notice should visit www.irs.gov/coronavirus or call the phone number listed in the letter. Taxpayers should also refer to the Form 7200 instructions for guidance on the preparation of this form.
Federal Relief Fund Dispute
A new COVID-related dispute has broken out between Governor Pritzker and two of the state’s largest business groups, this time over the distribution of $250 million in federal relief funds.
In a press conference and later interview, Illinois Municipal League Executive Director Brad Cole, joined by groups representing retailers and manufacturers, charged that proposed rules the Pritzker administration is pushing would prevent local communities from using grants as they want.
In particular, they said, economic support for local business has been excluded as an expense for reimbursement, even though language in in the federal CARES Act clearly allows that use. his administration told the groups that support for business had been taken care of in other state COVID-relief programs. Under the CARES Act, the state got an additional $2.7 billion for its own needs, with local governments in Illinois allotted an additional $2.2 billion. Of that latter amount, $1.4 billion was sent directly to the city of Chicago and Cook, DuPage, Kane, Lake and Will counties, and Cole said he’s received no complaints that businesses in those jurisdictions are not receiving their fair share.
The problem is the other $800 million for other communities. The Legislature took $550 million and spent it on a variety of statewide programs instead of sending it to local governments. That leaves $250 million the state is allowing local governments outside the five Chicago-area counties to apply for. But under a proposal pending before a legislative panel, the Joint Committee on Legislative Rules, economic support for business is not allowed as a reimbursable expense. Municipalities would have to use up their allotment by Nov. 1, not the Dec. 31 date specified by federal law.
Extension on License Renewals
Illinois motorists will have another month to deal with expired driver’s licenses and license plates. Secretary of State Jesse White said that motorists will now have until Nov. 1 to renew licenses, state ID cards and license plate stickers that expired while state government was largely shut down because of the coronavirus pandemic. That new deadline means that people whose licenses or plates expire in July, August or September will also have until Nov. 1 to get them renewed.
Finally, a reminder about our next virtual conference for Monday, July 13. The topic is Supporting Employee Mental, Emotional and Social Health. Please join the Joliet Chamber and WorkLife Partnership for a free, interactive virtual conference to discuss:
- Resolving challenges that manifest into stress, anger, anxiety, depression and even trauma
- Confront issues that prevent employees from thriving, alleviate strain and empower employees to be more resilient
- As an employer, how can you play a part in rebuilding a stronger workplace
You can register here for the session next Monday beginning at 1:00 PM – http://jolietchamber.chambermaster.com/events/details/2020-webinar-july-13-supporting-employee-mental-emotional-and-social-health-5923
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
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