While the unemployment insurance (UI) program is one of the largest safety net programs in the United States, research on its benefits is limited. This paper exploits plausibly exogenous changes in ...state UI laws to empirically estimate whether UI generosity mitigates any of the previously documented negative health effects of job loss. The results show that higher UI generosity increases health insurance coverage and utilization, with stronger effects during periods of high unemployment rates. During such periods, higher UI generosity also leads to improved self-reported health. Finally, I find no effects on risky behaviors or health conditions.
This article shows that equilibrium unemployment dynamics can significantly increase the efficacy of fiscal policy. In response to a shock that brings the economy into a liquidity trap, an expansion ...in government spending increases output and causes a fall in the unemployment rate. Since movements in unemployment are persistent, the effects of current spending prevail into the future, leading to an enduring rise in income. As an enduring rise in income boosts private demand, an increase in government spending sets in motion a virtuous employment-spending spiral with large effects on macroeconomic aggregates.
Unemployment Insurance benefit durations were extended during the Great Recession, reaching 99 weeks for most recipients. The extensions were rolled back and eventually terminated by the end of 2013. ...Using matched CPS data from 2008-2014, we estimate the effect of extended benefits on unemployment exits separately during the earlier period of benefit expansion and the later period of rollback. In both periods, we find little or no effect on job-finding but a reduction in labor force exits due to benefit availability. We estimate that the rollbacks reduced the labor force participation rate by about 0.1 percentage point in early 2014.
Not Working Blanchflower, David G
2021, 2019, 2019-06-18, 2021-04-13, 2021.
eBook
A candid assessment of why the job market is not as healthy as we think
Don't trust low unemployment numbers as proof that the labor market is doing fine—it isn't. Not Working is about those who ...can’t find full-time work at a decent wage—the underemployed—and how their plight is contributing to widespread despair, a worsening drug epidemic, and the unchecked rise of right-wing populism.
In this revelatory and outspoken book, David Blanchflower draws on his acclaimed work in the economics of labor and well-being to explain why today's postrecession economy is vastly different from what came before. He calls out our leaders and policymakers for failing to see the Great Recession coming, and for their continued failure to address one of the most unacknowledged social catastrophes of our time. Blanchflower shows how many workers are underemployed or have simply given up trying to find a well-paying job, how wage growth has not returned to prerecession levels despite rosy employment indicators, and how general prosperity has not returned since the crash of 2008.
Standard economic measures are often blind to these forgotten workers, which is why Blanchflower practices the economics of walking about—seeing for himself how ordinary people are faring under the recovery, and taking seriously what they say and do. Not Working is his candid report on how the young and the less skilled are among the worst casualties of underemployment, how immigrants are taking the blame, and how the epidemic of unhappiness and self-destruction will continue to spread unless we deal with it.
Using de-identified bank account data, we show that spending drops sharply at the large and predictable decrease in income arising from the exhaustion of unemployment insurance (UI) benefits. We use ...the high-frequency response to a predictable income decline as a new test to distinguish between alternative consumption models. The sensitivity of spending to income we document is inconsistent with rational models of liquidity-constrained households, but is consistent with behavioral models with present-biased or myopic households. Depressed spending after exhaustion also implies that the consumption-smoothing gains from extending UI benefits are four times larger than from raising UI benefit levels.
This paper uses microdata to evaluate the impact on the steady-state unemployment rate of an increase in maximum benefit duration. We evaluate a policy change in Austria that extended maximum benefit ...duration and use this policy change to estimate the causal impact of benefit duration on labor market flows. We find that the policy change leads to a significant increase in the steady-state unemployment rate and, surprisingly, most of this increase is due to an increase in the inflow into rather than the outflow from unemployment.
We use the high-frequency, decentralized implementation of stay-at-home (SAH) orders in the United States to disentangle the labor market effects of SAH orders from the general economic disruption ...wrought by the COVID-19 pandemic. We find that each week of SAH exposure increased a state's weekly initial unemployment insurance (UI) claims by 1.9% of its employment level relative to other states. A back-of-the-envelope calculation implies that of the 17 million UI claims between March 14 and April 4, only 4 million were attributable to SAH orders. We present a currency union model to provide conditions for mapping this estimate to aggregate employment losses.
From 1989 to 2012, on average, 23% of those eligible for unemployment insurance (UI) benefits in the US did not collect them. To understand the implications of these “unclaimed” benefits, we develop ...a directed search model with an endogenous UI take-up rate. In equilibrium, UI collectors have longer unemployment durations relative to non-collectors. The difference results from two forces, a consumption effect and a private information effect, as UI collection histories are unobservable. We characterize both effects analytically and quantitatively. With an endogenous take-up rate, the unemployment rate and average duration of unemployment respond significantly slower to changes in the UI benefit level, relative to the standard model with a 100% take-up rate. The private information effect on non-collector job finding rates plays an important role in this result.
An indispensable investigation into the American unemployment system and the ways gender and class affect the lives of those looking for work Through the intimate stories of those seeking work, The ...Tolls of Uncertainty offers a startling look at the nation's unemployment system—who it helps, who it hurts, and what, if anything, we can do to make it fair. Drawing on interviews with one hundred men and women who have lost jobs across Pennsylvania, Sarah Damaske examines the ways unemployment shapes families, finances, health, and the job hunt. Damaske demonstrates that commonly held views of unemployment are either incomplete or just plain wrong. Shaped by a person's gender and class, unemployment generates new inequalities that cast uncertainties on the search for work and on life chances beyond the world of work, threatening opportunity in America.Following in depth the lives of four individuals over the course of their unemployment experiences, Damaske offers insights into how the unemployed perceive their relationship to work. She reveals the high levels of blame that women who have lost jobs place on themselves, leading them to put their families' needs above their own, sacrifice their health, and take on more tasks inside the home. This "guilt gap" illustrates how unemployment all too often exacerbates existing differences between men and women. Class privilege, too, gives some an advantage, while leaving others at the mercy of an underfunded unemployment system. Middle-class men are generally able to create the time and space to search for good work, but many others are bogged down by the challenges of poverty-level unemployment benefits and family pressures and fall further behind.Timely and engaging, The Tolls of Uncertainty posits that a new path must be taken if the nation's unemployed are to find real relief.
The Social Safety Net in the Wake of COVID-19 BITLER, MARIANNE P.; HOYNES, HILARY W.; SCHANZENBACH, DIANE WHITMORE
Brookings papers on economic activity,
2020, Letnik:
2020, Številka:
2
Journal Article
Recenzirano
Odprti dostop
The COVID-19 crisis has led to spiking unemployment rates with disproportionate impacts on low-income families. School and child-care center closures have also meant lost free and reduced-price ...school meals. Food prices have increased sharply, leading to reduced purchasing power for families with limited income. The Families First Coronavirus Response Act and the Coronavirus Aid, Relief, and Economic Security Act constituted a robust response, including expansions to unemployment insurance (expansions in eligibility and a $600 per week supplement), a onetime payment of $1,200 per adult and $500 per dependent, an increase in SNAP payments, and the launch of the Pandemic EBT program to replace lost school meals. Despite these efforts, real-time data show significant distress—notably, food insecurity rates have increased almost three times over the pre-COVID-19 rates and food pantry use has also spiked. In this paper, we explore why there is so much unmet need despite a robust policy response. We provide evidence for three explanations: (1) timing—relief came with a substantial delay, due to overwhelmed unemployment insurance (UI) systems and the need to implement new programs; (2) magnitude—payments outside UI are modest; and (3) coverage gaps—access is lower for some groups, and other groups are statutorily excluded.
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