Unemployment Insurance Is Not Ready for the Next Downturn

Republicans have blamed the additional unemployment benefits for creating a “labor shortage” in 2021, but businesses will continue to complain about labor shortages long after the extensions expire. (Photo: Nam Y. Huh/Associated Press)

Republicans have blamed the additional unemployment benefits for creating a “labor shortage” in 2021, but businesses will continue to complain about labor shortages long after the extensions expire. (Photo: Nam Y. Huh/Associated Press)

No one knows when the next recession will hit, but those who are out of a job will fall into a safety net that is weaker than ever.

After Congress turbocharged unemployment benefits in response to the coronavirus pandemic, lawmakers in three states have already reduced the state-funded benefits that are the basis of unemployment insurance.

Lawmakers at the federal level, meanwhile, have said so he lost all desire in order to improve the system even after the epidemic exposed its flaws to the whole world. And it’s hard to imagine Congress taking action and extending benefits for a while as Republicans continue to blame inflation on the additional benefits that Democrats approved last year.

“We’ve seen an incredible shutdown in Congress to pass things that are very popular with people, like the $15 minimum wage,” Rebecca Dixon, director of the National Employment Law Project, told HuffPost. “I think we’re going to get to a point where there’s a problem and Congress can’t get out of the problem and deal with it.”

In response to every recession since the 1950s, Congress has added additional weeks of benefits to the standard 26 provided by states. After lawmakers temporarily extended benefits to 73 weeks because of the recession, Republicans in 10 states cut the duration of their government programs.

The give-and-take process has grown significantly with the coronavirus pandemic. Congress added more weekly benefits in 2020 and took unprecedented steps to temporarily raise the weekly benefit limit by $600 and expand eligibility to include workers without full-time paying jobs, such as rideshare drivers.

Republican governors in 25 states took the unprecedented step of rejecting additional federal benefits in 2021. State legislatures in 10 states also took advantage of the benefits cuts, according to Andrew Stettner, director of workforce policy at The Century Foundation, a think tank.

“It was bad last quarter and we expect some of these countries to come back,” Stettner said in an email.

Only Iowa, Kentucky and Oklahoma cut benefits in the final legislative session. Kentucky’s new law it also established job search requirements; Iowa needs recruiters accepting low-wage jobs.

Iowa Republican Representative Michael Bousselot said the safety net should be a safety net and a trampoline that compensates those who are laid off.

“What we want to do is reassess unemployment on ‘re-employment,’ rather than just being on the defensive,” Bousselot said. he said in March.

State and federal Republicans have blamed some benefits for the “worker shortage” in 2021, but businesses he continued to complain a reduction in the number of employees over time after additional benefits are exhausted.

One of the most important actions Congress took in 2020 allowed self-employed and independent contractors, such as Uber drivers, to register for Federal unemployment insurance benefits for the first time in history. The Pandemic Unemployment Assistance program paid workers who did not qualify for regular unemployment because they did not have a record of wages on file with their state.

A Bloomberg research showed that during the first year of the epidemic, black workers in Georgia were more likely to be deprived of regular benefits than their white counterparts; Special benefits of the pandemic have helped close some of the profit gap. But the program can be he is well known for deception more than reducing racial differences.

It is very difficult to bring attention to the program when there is no problem.Rebecca Dixon, director of the National Employment Law Project

Progressive Democrats want to reform the unemployment system to accommodate non-traditional workers, reduce disparities between states and prevent states from cutting benefits. And they want to upgrade the outdated technology used by many government agencies. Some workers have had to wait months for benefits because of the hardships experienced by previous governments.

But Democrats abandoned that proposal even in the more expansive version of the domestic policy they ended up with wipe and go last month as the Inflation Reduction Act. There is no hope of his return soon.

Dixon said it may take another challenge to create a chance for Congress. He said: “It is difficult to explain this program when there is no problem.

Many economists expect a recession and job cuts sometime next year as the Federal Reserve raises interest rates to slow the recession by shrinking the economy. Job growth has remained strong, but there are warning signs.

Matt Darling, a labor policy fellow at the center-right Niskanen Center, has pointed to widening gaps between unemployment among college-educated and non-educated workers, and between white and black workers.

“If we look at the results of the Federal Reserve’s [rate hikes]this is the place we were hoping to see first,” Darling said in an interview.

It’s possible that the widening gaps represent “noise” in the data, but it may be that layoffs have begun to increase the number of vulnerable American workers.

Dixon said he doesn’t think the recession caused by rising interest rates will be as bad as the one caused by the pandemic or the one caused by the financial crisis more than a decade ago. But they hope for a better example of those who get hurt the most.

“I don’t know that there will be much pain from the recession, if we have it soon, but there will be pain,” he said. “And the people who feel the most pain are the ones who are most likely to be locked out of the UI system.”

This article appeared first HuffPost and it has been changed.