Download the entire Issue Guide in PDF format

Revised August 2004

The EPI Issue Guide on unemployment insurance consists of the following:
An introduction to unemployment insurance
Key tables
Resources
Facts at a glance about unemployment insurance
Frequently asked questions (FAQs) about unemployment insurance
Unemployment insurance weekly benefit amount calculator (by state, wages, work schedule, and family type) 

An introduction to unemployment insurance
The unemployment insurance (UI) program is a joint federal and state program that was established in 1935 to provide an essential safety net for workers who become involuntarily unemployed. Federal law and regulations provide broad guidelines and some minimum standards that the states must meet.  Beyond that, the states are free to set the important parameters of their UI programs—eligibility requirements, benefit levels, and financing.   As a result, the unemployment insurance programs vary across all 50 states and the District of Columbia.   The unemployment insurance program is financed through state and federal payroll taxes paid by employers.  

In 2003, about 40% of unemployed workers received unemployment insurance benefits.  In 2003, the average weekly benefit check was $262, which replaced, on average, 47% of a worker's previous salary.  Workers received that benefit for an average of 16.4 weeks in 2003. Because states determine who is eligible for benefits, the weekly benefit amounts, and the duration of the benefits, the generosity of the UI program varies significantly by state.  

Since the UI program was established, there have been a number of important changes in the labor market, including the rise in part-time and temporary work, the increased role of women in the workforce, and the rise of dual-income families and the difficulties they face balancing work and family obligations. Unfortunately, the unemployment insurance program has not kept pace with these changes, and presents particular difficulties for these groups of workers, as well as low-wage workers.   Providing the assistance necessary to help these families requires the following state-based reforms:

• States should consider a worker's most recent earnings when determining eligibility for benefits.
• States should extend eligibility to workers seeking part-time jobs.
• States should base their eligibility requirements on hours worked, not wages, to alleviate the inherent discrimination against low-wage workers.
• States should pay more generous benefits to keep workers and their families out of poverty.

Facts at a glance about unemployment insurance
For more information on the following unemployment insurance topics, read this Issue Guide's facts at a glance about unemployment insurance, which covers:

• Eligibility requirements to receive UI benefits,
• Amount of UI benefits,
• Duration of UI benefits,
• Financing UI benefits, and
• Recommendations to improve the UI program.

Frequently asked questions (FAQs) about unemployment insurance
For answers to the following UI questions, read this Issue Guide's Frequently Asked Questions  (FAQ) section, which answers the following questions:

• What is the purpose of unemployment insurance?
• Who is eligible for unemployment insurance?
• Who actually receives unemployment insurance?
• Does the unemployment insurance program treat all workers fairly?
• What can be done to make the unemployment insurance program more fair and increase the number of workers who receive unemployment insurance?
• What is the relationship between unemployment insurance and welfare?

Key tables on unemployment insurance

Table A: State UI Policies as of June 2004 (monetary eligibility requirements, weekly benefit amounts, dependent allowance) 

Table B: Characteristics of State UI Benefits, 2003 (average weekly benefit amount, average duration, recipiency, exhaustion rate, unemployment rate, average weekly wage)

Table C: State UI Financing (taxable wage base, minimum and maximum employer tax rates, average state tax rate, state taxable wage base) 

 

Other unemployment insurance resources

Key EPI Publications:

Time's up for the unemployed: Congress should use the unemployment insurance trust funds for their intended purpose. By Ross Eisenbrey and Jeffrey Wenger (2003).

Time to fix the federal unemployment benefits program: Long-term joblessness rising beyond the recession. By Maurice Emsellem and Jeffrey Wenger (July 2002).

Failing the unemployed: A state-by-state evaluation of unemployment insurance systems. By Maurice Emsellem, Jessica Goldberg, Rick McHugh, Wendell Primus, Rebecca Smith, and Jeffrey Wenger (2002).

Coming up short: Current unemployment insurance benefits fail to meet basic family needs. By Jeffrey Wenger (2001).

Divided we fall: Deserving workers slip through America's patchwork unemployment insurance systems. By Jeffrey Wenger (2001).

Mending unemployment with the minimum wage. By Jeffrey Wenger (2001).

Other unemployment insurance publications:

Family Income of Unemployment Insurance Recipients. Congressional Budget Office (2004).

Between a rock and a hard place: Confronting the failure of state UI systems to serve women and working families.  
National Employment Law Project (2003).

Laid off and left out: Part-time workers and UI.   National Employment Law Project (2002).

Unemployment insurance: Role as a safety net for low-wage workers is limited.  General Accounting Office (2000).

Unemployment insurance and welfare recipients: What happens when the recession comes?  Harry J. Holzer, Urban Institute (2000).

Other unemployment insurance resources on the Web:

Unemployment Insurance Safety Net Project
From the National Employment Law Project

Unemployment Insurance and Labor Market Policies
Center on Budget and Policy Priorities

Making Wages Work — Unemployment Insurance Web Site
From the Annie E. Casey Foundation

Unemployment Insurance Data and Statistics
From the U.S. Department of Labor

 

Download the entire Issue Guide in PDF format