Thu, Apr 23 at 4:03 PM Arizona Lawyer Alison C. Briggs writes:
Chances are, you or someone you know has had their income reduced due to the spread of coronavirus. Whether it’s a reduction in hours or pay rate, fewer sales at small businesses, being furloughed, or a layoff, over 43% of American households are estimated to be experiencing a financial setback due to the pandemic. Lawmakers have had to work quickly to revise unemployment procedures and distribute stimulus checks to avoid an economic crisis.
More than 400,000 people have filed unemployment in Arizona since the pandemic began. In a typical week, there would typically only be about 3,000 unemployment filings. For the week ending April 18, 2020, Arizona paid out a record $151 million in unemployment compensation. The Arizona unemployment office has had to hire additional staff to deal with the sudden burst of filings.
Nationwide, an estimated 24 million have filed unemployment since the start of the pandemic. The overall unemployment rate is between 12-15%. Some economists are projecting unemployment to rise to about 25%, a high only reached previously during The Great Depression. During the week beginning 4/12/20, 4.4 million new unemployment claims were filed. During the recession of 2008, the highest week of unemployment claims was only 665,000. Times have changed, but Americans should still be prepared for a period of economic downturn.
In response to the pandemic, lawmakers passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to mitigate the economic effects as much as possible. Many Americans can expect to receive a stimulus of at least $1,200. The government has already approved $350 billion in business loans and should be approving more shortly. However, this may not be enough to soften the financial blow for many.
History has shown that in times of economic downturn, one can expect increases in foreclosures, repossessions, and bankruptcy filings. In 2008, vehicle repossessions increased 10-15%. Home foreclosures increased by 81%. Bankruptcy filings increased by 33%. With unemployment rates higher than they were during the recession in 2008, we can expect to see similar rises in all three categories.
For the time being, we can only wait on government leaders to say when quarantine orders will be lifted and businesses can begin to reopen. If you are a business owner struggling to stay afloat, or an individual who has been laid off, you don’t have to wait until the pandemic is over to start your game plan. Use the ample amount of at home time that you have right now and plan for your financial future.
Our office is open and available for phone consultations to determine if filing a Phoenix bankruptcy is a good option for you. We offer many options including bankruptcy by phone, Arizona Zero Down Bankruptcy, File Now... Pay Later, and many other debt relief options. We are practicing all of the COVID-19 safe practices. Call and schedule your free consultation today.
Comments