The Nature of Unemployment Insurance Benefits During COVID

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In March 2020, communities across the United States realized the gravity of the novel coronavirus pandemic and the deadly reach of COVID-19, the disease caused by the virus. As businesses shut their doors to prevent the transmission of the disease, the joint federal-state Unemployment Insurance program, which funds and administers unemployment benefits, provided important income replacement for people who could no longer report to work. Today, as March’s waves of temporary layoffs turn into permanent job losses, the role of the Unemployment Insurance system in stabilizing the U.S. economy and providing income security to unemployed workers and their families is no less crucial.

Yet although the continuing coronavirus recession makes clear the importance of unemployment benefits, the severe strains on the Unemployment Insurance system illuminate the deep flaws in the program. Inadequate financing for administration continues to cause long delays for workers who apply for unemployment benefits, as well as the denial of benefits for eligible workers. Stingy benefits paid by many states also leave workers relying on a patchwork system of uncertain federal benefits supplements…



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