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Unemployment Insurance

Author

Listed:
  • Stephen Woodbury

    (Michigan State University
    W.E. Upjohn Institute for Employment Research)

Abstract

Unemployment insurance (UI) provides temporary income support to workers who have lost their jobs and are seeking reemployment. This paper reviews the origins of the federal-state UI system in the United States and outlines its principles and goals. It also describes the conditions for benefit eligibility, the benefits themselves, and their financing through the UI payroll tax. The UI system is complex and includes many interested parties, including employers, worker advocates, state UI administrators, and the federal government. These parties' differing views have led to controversies over benefit eligibility, adequacy, and whether the states or federal government should bear primary responsibility for UI. The Great Recession caused most states’ UI trust funds to become insolvent and has led to renewed debate over the structure and financing of the system.

Suggested Citation

  • Stephen Woodbury, 2013. "Unemployment Insurance," Upjohn Working Papers 14-208, W.E. Upjohn Institute for Employment Research.
    • Handle: RePEc:upj:weupjo:14-208
    as

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    References listed on IDEAS

    as
    1. Topel, Robert H, 1984. "Experience Rating of Unemployment Insurance and the Incidence of Unemployment," Journal of Law and Economics, University of Chicago Press, vol. 27(1), pages 61-90, April.
    2. Davidson, Carl & Woodbury, Stephen A., 1997. "Optimal unemployment insurance," Journal of Public Economics, Elsevier, vol. 64(3), pages 359-387, June.
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    6. Saul J. Blaustein, 1993. "Unemployment Insurance in the United States: The First Half Century," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number uius.
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    8. Hopenhayn, Hugo A & Nicolini, Juan Pablo, 1997. "Optimal Unemployment Insurance," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 412-438, April.
    9. Edi Karni, 1999. "Optimal Unemployment Insurance: A Survey," Southern Economic Journal, John Wiley & Sons, vol. 66(2), pages 442-465, October.
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    11. Martin Feldstein, 2005. "Rethinking Social Insurance," American Economic Review, American Economic Association, vol. 95(1), pages 1-24, March.
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    13. Gruber, Jonathan, 1997. "The Consumption Smoothing Benefits of Unemployment Insurance," American Economic Review, American Economic Association, vol. 87(1), pages 192-205, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Social insurance; unemployment; unemployment insurance; income support; federal-state relations; trust funds; trust fund insolvency; benefit adequacy; benefit eligibility; payroll tax;
    All these keywords.

    JEL classification:

    • H1 - Public Economics - - Structure and Scope of Government
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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