Maine’s estimated unemployment rate for April shot up to 10.6 percent as the economic devastation unleashed by the coronavirus pandemic washed over the state and the nation.

The jump of 7.4 percentage points from March to April was the highest single-month increase since Maine adopted its current estimating methodology in 1976, the state Department of Labor said.

The April jobs report is the first glimpse at how the state’s labor market has responded to the havoc caused by suppressed consumer demand and measures to limit the spread of the coronavirus.

The unemployment situation’s full magnitude is obscured because the pandemic complicated data collection, state labor economists said. Businesses and households didn’t respond to surveys and some people who are out of work were uncounted because they were not actively looking for jobs.

“While this is the clearest picture to date, these are preliminary estimates that will be revised,” said Mark McInerney, director of the state Center for Workforce Research and Information.

Maine lost 98,400 payroll jobs last month, according to survey data compiled by the U.S. Bureau of Labor Statistics and the state labor department.


Kirsten Solomon’s job was one of the casualties. Business dried up in mid-March at the wedding and event planning company where she was a sales manager. By early April, her job was eliminated permanently.

It took Solomon, 32, six weeks to get benefits from the state’s overwhelmed unemployment insurance system. In the meantime, she contacted a recruiter to test the waters. It wasn’t encouraging.

“It was a grim conversation,” Solomon said. “Especially in sales, it doesn’t look like there will be many jobs open in the next year. Sales is important but not necessary to run an operation.”

Losing a career that she spent 10 years working on hurts, and Solomon is considering going back to school for a graduate degree in nutrition. She is lucky to have savings and a partner who works full time, but others don’t have the same safeguards, Solomon said.

“It’s tough because a lot of people aren’t getting paid, businesses are closing, but we are expected to pay rent and bills,” she said. “That didn’t come to a pause.”

About 77,300 Mainers were unemployed in April, according to estimates from household surveys. But that number is probably smaller than it should be, labor department economists said Friday.


To be counted as unemployed, a person must have been looking and available for work in the previous four weeks. That’s hard with businesses closed, people under stay-at-home orders and some expecting to return to their jobs when the crisis passes.

“Many people didn’t feel safe; as a result we see a large number of respondents not counted as employed,” said McInerney, from the state research center. “They were likely job-losers who would have otherwise been capable to go back to work.”

However, there were 28,600 fewer people in the state’s workforce in April than in February, an unusually large drop for this time of year. That signals those people were likely laid off, too.

A wave of job losses hit every major economic sector, and the hospitality and leisure industry was devastated, losing 42,600 jobs, about 61 percent, from February to April. Hotels, restaurants and bars were some of the first businesses ordered to close in an effort to prevent the spread of the coronavirus.

About 16 percent of manufacturing jobs were lost, 15 percent of jobs in retail, and 14 percent of jobs in health care and social assistance.

None of Maine’s 16 counties has an unemployment rate below 10 percent, according to the April report. Cumberland County, the state’s most populous and the epicenter of its hospitality economy, shot up to an 11 percent unemployment rate. York County followed closely with an 11.6 percent jobless rate.


Rural western Maine had the highest unemployment rates in the state. Oxford and Somerset counties recorded unemployment around 14 percent, and Franklin County reached nearly 13 percent. The early shutdown of ski resorts, snowmobile tourism and other winter sports could help explain the higher joblessness there, labor economist Glenn Mills said.

However, Maine appears to have fared better than other New England states and the country at large, with the average regional unemployment rate at nearly 14 percent and the national rate close to 15 percent.

New Hampshire’s unemployment rate exceeded 16 percent. Other rates were 15.6 percent in Vermont, 15 percent in Massachusetts, 17 percent in Rhode Island and about 8 percent in Connecticut.

Whether the job losses reported Friday are just temporary or long-term will determine the trajectory of economic recovery.

“That is the big question throughout the nation and workplaces throughout the world,” Mills said.

Businesses that have no revenue will not rehire people, but Congress may pass laws that make the difference between workers having jobs or not after the country comes through the pandemic.


“That is really an unanswerable question at this point,” he said.

It is also uncertain whether job losses in April’s report will be the deepest cut into Maine’s labor force, or if further massive job losses will occur.

Unemployment benefits claims have been trending downward over the past two weeks, but it is unclear what will happen if seasonal jobs that people depend on aren’t available, given the uncertainty of a successful tourism season this year.

“There are so many factors to take into consideration, that really complicates the picture,” Mills said.

Other economists say the situation likely will get worse before improving. They warn of a long, hard road to recovery without massive government intervention.

Even if the coronavirus does not come roaring back this summer, fall or winter, as some public health experts believe, Maine businesses will be hurt badly by suppressed consumer confidence, said Michael Donihue, an economics professor at Colby College in Waterville.


This recession has hit at the heart of an economy that was increasingly reliant on in-person contact. Retail stores, tour operators, restaurants and hotels will have a tough time if people are scared to go out too much because the virus is still circulating.

“We haven’t had a recession that started in the consumer sector before,” Donihue said. “I am fearful that a lot of these jobs are gone long-term.”

If that is the case, and recovery takes much longer than originally expected, there may be a role for a federal program to provide basic income in exchange for public service, Donihue said.

“When you have successive months of unemployment, that is a huge drain on the economy you can’t fix just by throwing money at it,” he said. “You need alternatives to offer people at the national and local level.”

Expectations of a V-shaped recession, in which the economy contracts deeply then snaps back, is fantasy, said Michael Hillard, an economics professor at the University of Southern Maine.

More likely now, absent more government intervention, is a U-shaped recession, with a quick drop followed by a long period of economic stagnation and high joblessness before eventual recovery, he said.


Economic recovery will depend on the public health response, Hillard said. Consumers won’t feel comfortable traveling, going out to eat or spending too much if they worry about getting sick. But Maine and the U.S. have a long way to go to get the testing, tracing and isolation systems in place to address new cases and outbreaks before they become widespread, he added.

“If we get hit again in the fall and winter, what that will do to consumer behavior and confidence will be really damaging,” Hillard said.

Absent virus mitigation, it should fall on the federal government to use its massive borrowing power to keep the country on its feet in the meantime, he said. Key to that is direct financial support to local and state governments to keep services going, employees paid and more stimulus for the private sector.

“The clear thing is that we need something on a large scale,” Hillard said. “The thing that may damage us the most in the next two years is if we continue to think small.”

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