Less-Skilled Workers, Welfare Reform, and the Unemployment Insurance System
The declining economic position over the past two decades of those workers with less skill increases the importance of the unemployment insurance (UI) system in providing a safety net during periods of unemployment. Recent welfare reform legislation, designed to encourage labor market entry of typically very low-skilled workers who are likely to have unstable work patterns at best, potentially makes the UI system an even more critical component of the safety net. This paper seeks to determine how less-skilled workers typically fare in the UI system, estimating their likelihood of becoming eligible for and collecting benefits. We find that many workers who separate from a job, and particularly those with lower levels of skill, will not be compensated by the UI system. Although minimum earnings requirements keep some less-skilled job losers from receiving UI, it is the provision mandating that separations be involuntary' that prevents most workers from gaining UI eligibility. These findings suggest that the UI system will provide little additional support to the safety net following welfare reform.
|Date of creation:||Mar 1998|
|Date of revision:|
|Publication status:||published as Polachek, Solomon W. (ed.) Worker wellbeing in a changing labor market, Research in Labor Economics, vol. 20. Amsterdam; London and New York: Elsevier Science, JAI, 2001.|
|Contact details of provider:|| Postal: |
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jonathan Gruber, 1994. "The Consumption Smoothing Benefits of Unemployment Insurance," NBER Working Papers 4750, National Bureau of Economic Research, Inc.
- Rebecca M. Blank, 1997.
"What Causes Public Assistance Caseloads to Grow?,"
NBER Working Papers
6343, National Bureau of Economic Research, Inc.
- Gruber, Jonathan, 1997. "The Consumption Smoothing Benefits of Unemployment Insurance," American Economic Review, American Economic Association, vol. 87(1), pages 192-205, March.
- McCall, Brian P, 1995. "The Impact of Unemployment Insurance Benefit Levels on Recipiency," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 189-98, April.
- Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-81, September.
- Gottschalk, Peter & Maloney, Tim, 1985. "Involuntary Terminations, Unemployment, and Job Matching: A Test of Job Search Theory," Journal of Labor Economics, University of Chicago Press, vol. 3(2), pages 109-23, April.
- Anderson, Patricia M & Meyer, Bruce D, 1997. "Unemployment Insurance Takeup Rates and the After-Tax Value of Benefits," The Quarterly Journal of Economics, MIT Press, vol. 112(3), pages 913-37, August.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:6489. See general information about how to correct material in RePEc.
If references are entirely missing, you can add them using this form.