Unemployment assistance for gig workers amid coronavirus outbreak

Yahoo Finance’s Kristin Myers joins Zack Guzman to discuss how the new PUA program helping gig workers who may be unemployed due to the coronavirus pandemic.

Video Transcript

ZACK GUZMAN: --from gig workers out there. And whether or not you work for Lyft or Uber or another company, a lot of people were wondering if the unemployment claim insurance applies to them as a gig worker. That's been a very popular question.

And the other one has been, as we saw the stimulus bill passed and including those workers, what happens to the numbers we're going to be seeing in the coming weeks for unemployment claims, once they get included into the numbers as well? And I want to get to Kristin Myers who's been digging into both those questions. Kristin.

KRISTIN MYERS: Hey, Zack. Well, to answer that question, the answer is, yes. With the new passage of the CARES Act, if you are a gig worker or a freelancer or independent contractor, whatever you want to call yourself, you are now eligible for unemployment benefits. That's under this new program called the PUA. That's the Pandemic Unemployment Assistance.

And it's a brand new program, because previously, independent contractors were not eligible for any type of unemployment benefits, because they didn't have any one employer, of course, as we know, contributing to some sort of unemployment insurance.

So as we saw just this week, 6.6 million people, workers, essentially filed for unemployment. Now those figures do not actually include gig workers, because while those gig workers actually are eligible for unemployment, because it's a new program, these states essentially are scrambling to be able to process applications from those gig workers.

So the definition of gig worker is a little bit loose, but we're just going to use what the Bureau of Labor Statistics says is a gig worker. So that means we have roughly 11 million workers that are going to be qualified or classified as gig workers and could be eligible under this new program.

That's 11 million people, Zack, that might be filing for unemployment in the coming days and weeks. That's about 7% of all the American workers.

Now in the western states, you've got California, Hawaii, Washington, Idaho even. That's where you have the highest concentration of those freelancers, of those independent contractors.

And one economist I spoke with today said we could actually be seeing a pop of 10% in addition to those unemployment figures. So add another 700,000 folks that we might see in the next week, or two weeks, or three weeks. When those states are finally able to process those applications, we might see those folks getting added to those rolls.

So far, I've reached out to about six different states to the departments of labor. They haven't been able to get up and running, except for New York state, where we are currently right now. They are actually able to process some of those applications, but in other states, unfortunately, you are out of luck. You're going to have to wait just a little bit longer until those states can get those programs up and running so that people can apply and get some of those unemployment benefits.

ZACK GUZMAN: Yeah, we definitely saw that, too, just week over week when we saw the number jump from 3.3 to above six million unemployment claims. A lot of that had been because some people who applied last week weren't actually get-- weren't able to be addressed.

We saw that in states California and New York also jumping this past week by more than 3% week over week. I mean, I guess that would be expected to continue to rise here as what you're describing spills over into next week's number.

KRISTIN MYERS: Absolutely. So when I spoke to the departments of labor at, you know, states like Texas, Rhode Island, California, they said that they were absolutely inundated with thousands and thousands and thousands of calls every single day. Just yesterday, the Department of Labor in Rhode Island told me that they had a wait list of about 11,000 people, of just gig workers, that wanted to apply for those benefits and were not yet able to, because Rhode Island, for example, just like many other states, is unable to process those applications just yet, because the program for gig workers is not up and running just yet.

They're hoping to roll that out next week. So we're going to see these states roll those programs out next week, even the week after. So we're going to see that 6.6 million number really start to jump up as some of those freelancers, those gig workers, those Uber and Lyft drivers start to get some of those unemployment benefits as well.

ZACK GUZMAN: Yeah, for sure. Got to buckle up for these numbers that are coming in, why you can't miss any of it here on Yahoo Finance. Thank you, Kristin Myers. We're going to have--