Information on Benefit Receipt
GAO-05-291: Published: Mar 17, 2005. Publicly Released: Mar 31, 2005.
The Unemployment Insurance (UI) program, administered by the U.S. Department of Labor in partnership with states, plays a critical role in ensuring the financial security of America's workforce. Established in 1935, UI serves two primary objectives: (1) to temporarily replace a portion of earnings for workers who become unemployed through no fault of their own and (2) to help stabilize the economy during recessions by providing unemployed workers money for basic needs, which helps boost demand for goods and services. In fiscal year 2004, approximately 8.8 million workers received UI benefits, totaling $41.3 billion across all UI programs. To gain a better understanding of the UI program, we asked the following questions: (1) How many people ever receive UI benefits during their early working lives, and how many receive UI benefits more than once? and (2) Does UI benefit receipt change over time, and does receipt vary by industry or occupation?
In summary, we estimate that about 38 percent of workers born between 1957 and 1964 received UI at least once between 1979 and 2002, with almost half of these individuals receiving UI benefits more than once. Another 39 percent of this age group of workers were eligible to receive UI benefits at least once but never did so. Nine percent of all workers in this age group are estimated to have been unemployed at least once but never eligible for UI benefits, mostly because of the conditions under which they separated from their jobs, such as leaving a job to look for other employment. The remaining 15 percent were employed at least once and subsequently never unemployed. As this baby boom group aged, its members experienced fewer UI-eligible unemployment spells but were more likely to receive UI benefits during these spells. Late baby boom workers had the greatest number of UI-eligible unemployment spells around the time of the recessions of the early 1980s, when most were beginning their working careers. Over time, the number of UI-eligible unemployment spells declined. This is not surprising, given changes in the overall economy and age-related changes for individuals, such as increasing levels of education, training, work experience, and job tenure, that made their employment more stable and made them less likely to become unemployed. Although these workers had more unemployment when they were younger, higher proportions of those who became unemployed when they were older (up to age 45) received UI benefits. More specifically, at ages 18 to 20, 15 percent of those eligible received UI benefits; at ages 36 to 45, the rate of receipt was 30 percent. Regarding UI receipt by industries and occupations, we found that rates varied.