In a recent New York Times article on problems with the American unemployment system, Eduardo Porter highlighted how “the system gives states incentives to scale back coverage,” resulting in most unemployed workers receiving no benefits at all. According to the W.E. Upjohn Institute for Employment Research, New Jersey and Massachusetts were the only two states where more than 50 percent of unemployed workers received UI benefits.
Of the 10 states with the highest share of unemployed workers receiving benefits, 8 are using the new, temporary flexibilities provided to states for the hiring of contractors as part of the CARES Act (Section 2106). This staffing flexibility was created in order to support UI eligibility determinations as historic numbers of workers have flooded their state agencies since the onset of the pandemic. Simon&Co. is pushing for Congress to extend UI staffing flexibility, which is currently set to expire on March 14.