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When a person loses their job in the U.S., they can qualify for unemployment insurance to compensate for lost income up to a certain amount. However, the largely state-run systems that provide unemployment insurance vary in how long (and how much) you receive that insurance.
According to the Bureau of Labor Statistics, as of September, 34.5 percent of unemployed people had been so for more than 26 weeks. While most states provide up to 26 weeks of unemployment insurance, six states provide more, while nine states provide less: Alabama, Arkansas, Florida, Idaho, Kansas, Michigan, Missouri, North Carolina, and South Carolina.
For context, the percentage of “long-term unemployed” — that is, people out of work more than 26 weeks — reached a 21st century peak of 45.5 percent in April 2010, in the aftermath of the Great Recession. Then the figure consistently declined until the COVID-19 pandemic hit, when it surged again to peak at 43.4 percent in March 2021. While it has declined in the months since, it still remains high by historical standards.
The Unemployment Insurance Improvement Act would require that states provide a minimum 26 weeks of unemployment insurance. It also contains a few other provisions such as requiring states to accept internet applications and provide them in non-English languages.
The Senate version was introduced on September 27 as S. 2865, by Sen. Ron Wyden (D-OR). The House version was introduced a week and a half later on October 8 as H.R. 5507, by Rep. Don Beyer (D-VA8).
Supporters argue that the events of the past year and a half should serve as a wakeup call to make some changes to the system for which an unprecedented number of Americans applied.
“The coronavirus pandemic caused swift and widespread economic devastation that continues to expose major weaknesses in America’s unemployment system,” Rep. Beyer said in a press release. “Far too many American workers who lost their jobs had to wait for months as their applications moved through outdated and difficult-to-navigate systems for benefits that still are not good enough in many states. Our legislation would update and strengthen unemployment benefits, establish minimum standards for duration of those benefits, expand coverage so it reaches more of those who need help, and raise the bar to make programs more accessible.”
“This proposal makes a down payment on long-overdue reform to our unemployment system, and was designed to fit in our upcoming package,” Sen. Wyden said in a separate press release. “Importantly, it would slow the race to the bottom on benefits, ensuring six months of benefits and coverage for part-time workers… This system has been intentionally broken to minimize the numbers of jobless workers who can access it, and we’re going to take significant steps toward fixing it.”
Opponents counter that shorter duration for unemployment benefits serves as an incentive to find work, particularly in states where the economy is doing well and there actually are numerous employment opportunities to be found.
“As Alabama’s economy continues its recovery, we are hearing from more and more business owners and employers that it is increasingly difficult to find workers to fill available jobs, even though job openings are abundant,” Gov. Kay Ivey of Alabama, one of the nine states with less than 26 weeks of unemployment insurance, said in a press release. “Among other factors, increased unemployment assistance, which was meant to be a short-term relief program during emergency related shutdowns, is now contributing to a labor shortage that is compromising the continuation of our economic recovery.”
“Alabama has an unemployment rate of 3.8%, the lowest in the Southeast, and significantly lower than the national unemployment rate,” Gov. Ivey continued. (That press release was from May; the state’s unemployment rate has since declined further to 3.1%.) “Our Department of Labor is reporting that there are more available jobs now than prior to the pandemic. Jobs are out there.”
The House version has attracted five cosponsors, all Democrats. It awaits a potential vote in the House Ways and Means Committee.
The Senate version has attracted two cosponsors, both Democrats. It awaits a potential vote in the Senate Finance Committee.
Last updated Nov 2, 2021. View all GovTrack summaries.The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on Oct 27, 2022.
Unemployment Insurance Improvement Act
This bill expands the list of requirements a state unemployment compensation system must follow to be compliant under federal law.
Specifically, the bill requires the maximum benefit period available to an individual be at least 26 weeks. The base period used to determine unemployment eligibility must consist of at least four completed calendar quarters preceding the claim and must include the most recently completed calendar quarter. Further, compensation must not be denied to an otherwise eligible individual who earns at least $1,000 during the highest quarter and at least $1,500 during the entire base period. Finally, compensation must not be denied under an ability to work, active search for work, or refusal to accept work provision solely on the basis of the number of hours of work the individual is seeking, so long as the individual is seeking at least 20 hours of work or half the hours the individual typically worked.
Employers that pay unemployment taxes to a noncompliant state system cannot claim amounts paid into the state system as a credit against federal unemployment tax due.
The bill also requires states to meet specified online claim system accessibility requirements and to ensure that offline means of filing are available. A state that does not comply cannot receive federal funds for administration of its state unemployment system.
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