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Four Decades of Declining Federal Leadership in the Federal-State Unemployment Insurance Program

Author

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  • Stephen A. Wandner

    (W.E. Upjohn Institute and Urban Institute)

Abstract

The unemployment insurance (UI) program was established in 1935. Unlike other social insurance programs created by the Social Security Act, it was established as a federal-state program. The federal government initially acted as a strong partner working with state agencies that operate the UI program. Over the past four decades, however, the federal role in the UI program has declined because of reductions in federal resources dedicated to the program and weakening policy leadership and programmatic support. As a result, states operate increasingly divergent UI programs, with many programs providing limited access to the program for experienced unemployed workers who are unemployed through no fault of their own. This paper analyzes the declining role of federal leadership and concludes that it has not been an effective force in maintaining and enhancing a program that should be doing more to ameliorate the effects of economy-wide unemployment and helping individual UI recipients to return to work. If the UI system is going to be effective in the future, especially in future recessions, major strengthening of the UI program is necessary.

Suggested Citation

  • Stephen A. Wandner, 2019. "Four Decades of Declining Federal Leadership in the Federal-State Unemployment Insurance Program," Upjohn Working Papers 19-314, W.E. Upjohn Institute for Employment Research.
    • Handle: RePEc:upj:weupjo:19-314
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    References listed on IDEAS

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    1. Stephen A. Wandner, 2010. "Solving the Reemployment Puzzle: From Research to Policy," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number srep.
    2. Gabriel Chodorow-Reich & Loukas Karabarbounis, 2016. "The Cyclicality of the Opportunity Cost of Employment," Journal of Political Economy, University of Chicago Press, vol. 124(6), pages 1563-1618.
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    Cited by:

    1. Tomaz Cajner & Andrew Figura & Brendan M. Price & David Ratner & Alison E. Weingarden, 2020. "Reconciling Unemployment Claims with Job Losses in the First Months of the COVID-19 Crisis," Finance and Economics Discussion Series 2020-055, Board of Governors of the Federal Reserve System (U.S.).

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    More about this item

    Keywords

    unemployment insurance; public policy; intergovernmental relations;
    All these keywords.

    JEL classification:

    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations

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