To receive unemployment payment or not — last summer, that was the question.
The wreckage left in the novel coronavirus’s wake still lingers in myriad ways, even as vaccines appear as a light at the end of a long, long tunnel. When the virus first reared its head in March 2020, businesses were among the first casualties: laying off employees, diminishing services, or closing their doors completely. And when the state restrictions eased, many employees weren’t ready to return, happy to rely on the federal government’s assistance rather than risk exposure to the contagious COVID-19.
Months later, the effects are still obvious, and, in most industries, full recovery is still a ways off. The employee tales in this story, from a range of trades, illustrate a grim landscape full of pitfalls, and yet also of opportunity.
It won’t surprise anyone that 2020 had the highest unemployment rate since the Great Depression in 1933 — a national spike from 3.5% in February 2020 to 14.7% by April. The accompanying chart shows the unemployment rate breakdowns in each of Moonshine Ink’s coverage area counties, and the effects felt (compared to the rest of the decade).
LINES OF THE TIMES: While the United States as a whole experienced its largest unemployment rate since 1933, El Dorado, Nevada, Placer, and Washoe counties had their own records broken. Displayed here are the last decade’s unemployment rates. For reference, the 2010/11 spike is fallout from the 2009 market crash. Chart by Sarah Miller/Moonshine Ink
While the graph’s spikes tell a rather significant story, some places barely noticed a change. Kati Craig, postmaster at the Tahoe Vista post office, told Moonshine that aside from following such guidance as masks, physical distancing, and plenty of hand washing, there was no turnover. The three staff on-site, including Craig, remain.
New Moon Natural Foods didn’t experience a reduction in business like many others; as a grocery store in the midst of closing restaurants, the Truckee and Tahoe City locations became lifelines. At the same time, keeping enough employees on staff was a challenge.
“There was definitely an upheaval, and fortunately there were many people out of work who wanted to work,” New Moon’s owner Billy Griffin shared. “Although I will say it was difficult. There was a period during the $600-a-week unemployment thing where people made the economic choice to say, ‘Why would I go expose myself in a grocery store setting to all those people when I could make $200 more than what I’m making on unemployment?’
Griffin explained there were about 10 spots during the peak of employee turnover that New Moon struggled to fill (roughly 12% of the workforce).
“It was odd because you’d look at the headlines and see 14 million people out of work, and you’re like, there’s no one applying,” he said.
The unemployment benefits certainly shook up the oft-used “work to live” phrase. Between March 29 and July 25, 2020, Americans receiving unemployment insurance benefits were granted an additional $600 per week through the Coronavirus Aid, Relief and Economic Security (CARES) Act if they had pandemic-related reasons for being out of work. While unemployment insurance can normally be collected for 26 weeks from the start of a claim, the Pandemic Emergency Unemployment Compensation (PEUC) allowed for a further 24 weeks.
Such benefits were carried on with the Continued Assistance for Unemployed Workers Act, signed Dec. 27, though at a smaller dollar: $300 a week for that same group of unemployed workers, expiring March 14, 2021.
The range of standard unemployment payments in California runs from $40 to $450 per week and from $16 to $469 per week in Nevada.
Sectioning out the sectors
The top five industries most impacted by the coronavirus pandemic, according to a September 2020 S&P Global Market Intelligence study, were airlines, leisure facilities, oil and gas drilling, auto parts and equipment, and restaurants. Tahoe’s own economy relies heavily on two of those industries (leisure and restaurants), and players in the local game shared their realities.
Wendylyn Clemens owns ECS Cleaning Solutions, a house-cleaning service covering the Tahoe Basin and the Carson City region. Despite the flood of people visiting the area in 2020, and the rise of occupancy in short-term rentals (according to AirDNA, up 55% from March to August in Truckee; up 50% in Tahoe City; and up 52% in Incline Village), ECS suffered.
Clemens said she heard from customers who didn’t want people in their home anymore in case of possible virus spread, and that they were canceling cleaning services until things “blew over.” And when California shut down leisure travel, there went the vacation home business.
“We went from a team of 15 down to three, and they were barely wanting to even work,” she said. “People actually laid themselves off, people with houses who had roommates, saying, ‘Hey, we don’t feel comfortable even working.’”
Alibi Ale Works is another local business straddling the Tahoe region’s state lines. Owner Kevin Drake told Moonshine that last March his taproom locations shut down “like just about every business did and laid off 90% of our staff and went to bare bones, a skeleton crew.”
General manager of Alibi’s Incline Village location, Aaron Zendner, wrote in an email that remaining Alibi staff “have been cross-trained to perform other tasks to help maintain hours, while others have improved their skill set to move into other roles.”
When restaurants and bars were able to reopen with limited capacity in June, Zendner explained that some of the employees expressed concern about the increase in likelihood of contracting COVID-19. Wouldn’t signing up to receive unemployment be the safer route? “We just remained flexible with everyone’s needs and desire to return back into the service industry,” he stated.
Rylan Cordova, general manager of the Alibi’s Truckee spot, echoed Zendner: “It is difficult to say if people are resisting to come back to work for unemployment benefits. They could be fearful of exposure to COVID or … this was simply the nudge they needed to move on to pursue their next career. In the end, it is each person’s choice.”
Neither Zendner nor Cordova are particularly worried about rehiring once the pandemic finally calms down. Hiring has always been a challenge in the Tahoe area, so they’re somewhat used to it.
“This is mainly due to the lack of housing, especially long-term rentals for people to live,” Cordova wrote in his email. “This was becoming an issue before COVID, but COVID has increased this issue at an exponential rate.”
The music sector hit a drawn-out flat note once Tahoe-area events began to be postponed or canceled. Carl Davis, for example, is a Truckee sound engineer working for Crux and the Tahoe Truckee School of Music, as well as pitching in his expertise for bands and small events when needed. All that and his own band, too.
“Long story long, I guess … summer of 2020 was supposed to be the busiest yet with all of my contracts and musical endeavors,” Davis shared with the Ink. “Of course, everything all dried up. All the contracts were gone. My band went dormant for months as we all quarantined … My gear sits in my garage in audio slumber, waiting for COVID to get under control [so] our community can enjoy live music again.”
It’s certainly been a challenge musically, not only because of the loss of income, but also because music is Davis’ passion. He’s focused on the silver lining, though: The school of music is seeking new avenues for its many programs, and Davis is the sound guy for all of it.
He also added, “My band is able to practice twice a week in a studio that has space for distancing, and masks are required.”
A fickle helping hand
Court Leve has enjoyed a steady flow of success in Truckee and North Tahoe for two decades through his photography business. In more recent years, Leve was hired to shoot executive retreats for corporate giants like Google, PG&E, and The Home Depot Foundation, bringing in nearly 70% of his annual income. COVID-19, of course, nipped those events in the bud.
“Pretty much when the ski resorts shut, every bit of business that I had for the future completely disintegrated,” Leve said. “… With the recession, at least there were standing businesses that people had already committed to. And if a company was doing well, they were still planning things, they were still getting married. But this was a full stop.”
Leve waited out the first few months, relying on previous income and hoping for a short-lived pause to life as he knew it. By mid-May 2020, though, it was time for him to pull the emergency brake. Comparing his quarter two earnings from 2019 to 2020, Leve says he was down 85% to 90% in income.
He applied for Pandemic Unemployment Assistance, federal help for those who might not normally meet unemployment benefit standards but have been affected financially by the coronavirus’s spread. As part of the assistance, Leve received a Visa debit card through Bank of America, which provides money every two weeks as long as he qualifies. (Similar to the extension of additional unemployment insurance, PUA expires March 14.)
“Every two weeks you go onto [California’s Employment Development Department] site [and] you certify for benefits,” Leve explained. “It asks you a series of questions, it’s the same every time: Were you too sick to work, did you look for work, is COVID the reason? And then describe who you are.”
As an independent contractor unable to work due to the pandemic, Leve reports whether he made or earned any money over a weekly period.
“You do it every two weeks [but] you break it down by week,” he said. “You could make $0 one week, you could make $10,000 the next. You could get benefits for the first week but not for the second.”
Each payment Leve received through the EDD he immediately transferred to his personal account — he figured it couldn’t hurt, and eventually, it was lucky he did.
In a Jan. 25 press release, the EDD announced that between March 2020 and Jan. 16, 2021, 19.5 million claims were processed through the California department, paying out $114 billion in unemployment. Of that, 9.7% of payments have been discovered as fraudulent, and up to an additional 17% of payments were to possible fraud accounts.
Leve was unable to access his account for about a week in December (he’d get an error message every time he tried to log on) and spent three days and many hours bouncing between the Bank of America and EDD phone lines, trying to speak with someone about his lack of access.
“This is how I felt: Hey, you can’t work, you lost your job, we’re going to give you money, and now you can’t have the money we told you we were going to give you,” Leve said. “And you can’t contact anybody.”
That problem, he continued, eventually fixed itself, though his account was frozen for another reason at the beginning of February — this time, to be adjudicated by EDD staff over the sale of print and stock photos. Regardless of numerous hours spent on the phone trying to understand the system’s issues, the long-term effects of the pandemic still loom. As an independent contractor in the events world, Leve says he’s used to fluctuations of income and he’s learned when the busy times of year are. That being said, 2021 is a new reality.
“I have absolutely no false hope that the phone is going to start ringing magically; it’s going to be a slow re-immersion,” Leve said. “These events that take hundreds of thousands of dollars and six months of planning, no one’s even planning to plan them yet.”
An employee-to-owner success story
Due to dining restrictions imposed during the pandemic, the National Restaurant Association shared that as of Dec. 1, 2020, over 110,000 restaurants across the country have closed either temporarily or for good.
COVID-19’s impacts on local restaurants are a sore spot for anyone in the industry, who, if they weren’t laid off or furloughed, saw a shift to curbside pickup and outdoor dining last year. That change is still prominent today.
But the 11-month stretch hasn’t been completely bad news for everyone. Tahoma residents Ryan Pool and Brittany Alexander have moved up the chain, from employees to fledgling business owners. The two are now leasing the building that until the end of last year housed West Shore Pizza. By mid-June 2021 at the latest, Pool said they’ll open Dog & Bear, a restaurant serving elevated bar food and pizza, a pursuit funded by both savings and a silent investor.
“My fiancée [Alexander] and I have dreamed of owning our own restaurant. Now we have the opportunity, and we’d like to fulfill it,” he continued. “… We’re not trying to reinvent the wheel; I think [pizza is] a service and a product that fits very well in Tahoma, so we want to keep that and just expand upon it a little bit.”
Regarding their quest to staff the restaurant, Pool said they’ll rely on the circle of friends and acquaintances established over their decade in Tahoma.
“With a lot of people leaving Tahoe,” he said, “either getting pushed out by the rental market or getting pushed out from the loss of jobs around here, I definitely think [hiring is] going to be a chore, but I’m confident that we know the right people to where we make it work.”
Pool and Alexander are long-time employees of the West Shore Café, and still work there. Pool said it’s difficult to speak about starting up a restaurant without sounding like a jerk, and that his heart goes out to those whose businesses have suffered. But he’s found hope in the creativity of other Tahoe businesses that have stuck through things.
“We’ve been cautiously optimistic that we can do this, and things will get better soon, especially with the vaccine coming out. That’s exciting,” he said. “We aren’t being naive and thinking this isn’t a huge risk, and we know this isn’t going to be an immediate thing … We know that we’re still in it, we’re not out of the woods yet, but we’re definitely optimistic that it’s coming.”