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The US Unemployment Benefits Evaluation Research Paper

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Updated: May 19th, 2020

Worth and Purpose

Unemployment rates keep growing by the day and render the country and unemployed individuals into tricky economic conditions. Unemployment benefits are one of the most important social programs provided by the government. It is temporal in nature and provides financial benefits to tax payers but have no jobs. The importance of unemployment benefits lie in its fulfillment of a genuine need for those who lose their sources of income to prevent them from getting into deep financial crises. With the surety of unemployment benefits, people evade getting into circumstantial crisis because of their jobless situations. This makes unemployment insurance a worthy program for the country, especially in periods when there is a steep economic downturn and many people lose their jobs often (Beranek & Kamerschen, 2011). It is a beneficial; program, which requires adequate consideration for its budgeting. The job market is very stringent of employment opportunities and several people risk losing their jobs each day. Because of such loss of stable incomes, the lifeline for support during such times is the unemployment benefits. It is the only hope for most people looking for means of earning, as they must survive within the weak economy with or without jobs.

Program Data

Unemployment insurance is for those who worked in the past and are seeking future employment. This situation leads unemployed workers to accept jobs that are unfit for their skills or inadequate for exploitation of their skills. Unemployment is responsible for increased conditions of underemployment and the fear for losing jobs is a possible cause for psychological anxiety. There can also be cases of depression, stress and loss of confidence. This is a crucial period of time since it makes the unemployed people to lose social skills and social contacts and at the same time, leaving the economy insufficiently utilized because of operation below its frontier of production possibilities (Ludwick & Mandel, 2011)

The data for the unemployment benefits program systematically works in coordination with state and local governments for the collection of information from government practitioners. The department of labor is in charge of provision of unemployment weekly claims report issued each Thursday. It presents seasonal adjustment for the unemployment benefits estimation for initial claims of the preceding week in the United States. The timeliness of these statistics is essential for the gauging of the labor market health and in extension, the performance in of the economy in general. The office of the unemployment benefits issues an assessment of the unemployment benefits in relation to budgetary status (Russo, 2012). The analysis of the data provides for the selection of unemployment benefits eligibility for the accessibility of the government program. Through stringent selection processes, chances for workers having high probability of staying without employment have high ranking for the need of unemployment benefits.

The results of adverse selection lead to profit maximization of agencies for private insurance setting for premiums because of the likelihood of no payment of to policyholders. High premium rates prevent people from purchasing insurance and through a compulsory program, the government manages to put the situation under control by avoidance of situations of adverse selection. This becomes the reason for the importance of the unemployment benefits such as unemployment insurance because of its potentiality for increasing efficiency. However, there is no elimination of moral hazards because of compulsory government provision of unemployment benefits program. Insurance companies are always keen to know the reasons for unemployment and become overly strict to those individuals who are unemployed out of their personal doing. This is usually difficult to discern, and leads so various incorrect decisions made regarding the eligibility for receiving of benefits. This means that the role of the government in the resolution of any of the claims can lead to efficiency (Beranek & Kamerschen, 2011).

Program structure

The program structure gives benefits to those who lose their jobs for a specific period. After that, they risk plunging into financial crisis should they not get jobs by the time their benefits expire. As things stand, the federal jobless benefits expire before most people get new jobs because of the sluggishness of the job market. This leaves many people with no means of paying their health insurance, home bills, utilities and automobiles as they continue looking for work. Most states have a provision of 26 weeks unemployment benefits period though the federal government program has an addition of 14 to 47 weeks on top of that depending in the unemployment rate of the state. This, thus, implies that the payment of unemployment benefits lies as a responsibility of both the state and the federal governments (Beranek & Kamerschen, 2011).

The stakeholders/customers/target audiences

The unemployment benefit targets those who lose their jobs and are with the intentions for getting employment in the future. It is for the sustenance of the unemployed so they do not suffer serious financial crisis during periods when they are out of work. The unemployed having benefits are majorly cash strapped and tend to spend the benefits fast enough to facilitate circulation within the market acting as a multiplier within the economy. Since most people have insignificant liquid capacity at times of layoffs, it is only necessary that they receive the unemployment benefits because of minimal chances for turning to other social programs, which may be expensive. However, since the state funded benefits are insufficient in sustenance of the unemployment benefits program given the high rates of unemployment, federal funding takes a key role in ensuring the sustainability of the program. The improvement of the economy leads the rate of unemployment to a minimum low, which helps in diminishing of unemployment insurance expenditures, and an increase in job prospects ensues leading to an increase in the pace of job creation. Therefore, the input of the federal government in the extension of the unemployment benefits program is essential in helping individuals to find new jobs before they exhaust their unemployment benefits (Russo, 2012).

There are imperfect claims that unemployment benefits increases reluctance for job searching. These claims state that most unemployed under the benefits scheme find life relatively equal as employees with meager employment and unemployed people with benefits. Such insinuations lead to stringency in allocation and approval of benefits, which can lead to locking out of people who deserve. What I would change about this program is its temporal stance. It is difficult getting jobs that the time duration given for receiving the unemployment benefits does not sustain people adequately. Many are the occasions when the period for receiving the benefits expires before people get any employment and that leaves them with the plight of financial sustenance. As much as there are concerns regarding the fact that an extension can probably cause laziness and unwillingness to seeking future employment by beneficiaries, it is worth putting an evaluation structure that ensures that those who deserve the benefits do not suffer at any given point when the benefits can be of essence to their survival (Russo, 2012).

The status of the unemployment benefits program

The status of the unemployment benefits program has the eligibility of individual influenced by state u8nemployment rates, employees’ earnings and the colander dates. The program offers 26 weeks benefits, but that can go beyond that through the extension program though it does not permit extension beyond 99 weeks of earning the unemployment benefits. However, for those who already exhausted their unemployment benefits there are no possibilities for getting any benefits. There are three types of unemployment benefits, which an unemployed individual can receive from the government (Beranek & Kamerschen, 2011). The first one is the unemployment compensation, which works on a standard recommendation for provision of unemployment benefits individuals under the federal-state unemployment compensation program to a maximum of 26 weeks. Second is the extended benefit, which targets individuals in specific states depending on their eligibility for entering the program. This can give about additional 20 weeks and the states are responsible for half of the payment of these benefits with the federal government taking charge of the remaining half. Lastly is the emergency unemployment compensation, which is a temporary program of the federal government. It goes to individuals who exhaust state benefits of regular unemployment benefits. It is applicable to all states regardless of the benefits rates.

Recommendation of the program

This program is worth pursuing because of the positive influences it promotes to the lives of beneficiaries and the effect on the economic status of the country. It is a wonderful means of using the taxpayers’ money because it maintains a successful stance in ensuring that there is stability of households that lost their stable incomes. The feasibility of this program lies in its capability of helping in the recovery of the economic status of the country especially in periods of recession. Since it is one of the greatest tools for maintaining a boost in economic growth, it is a worthy venture because it is reportedly responsible for increasing of the Gross Domestic Product (GDP) by about $ 1.60.

This leaves it as a highly ranked influencer in the increase of employment and growth (Beranek & Kamerschen, 2011). An alternative unemployment benefits policy is essential for the reduction of the effects of moral hazard and costs. This can introduce individuals to the importance of opening up savings accounts. Employers can spear head such an initiative so that employees can have a savings account for their withdrawals upon layoff. Such a plan can be convenient for payment of relevant amounts of money as benefits to employees who retire without layoffs but very beneficial to those who lose their jobs prematurely. Therefore, other than just being an opportunity for maintaining stability in American homes it is a key fiscal stimulus source for easing labor market pressures. The cost of sustenance of this social benefit is incremental because it cuts across individual benefits and extends to state and federal beneficial sustenance of the economy (Russo, 2012).


Beranek, W., & Kamerschen, D. R. (2011). Unemployment Benefits and Unemployment. Modern Economy, 2(5), 800-803.

Ludwick, M. S., & Mandel, B. A. (2011). Analyzing Federal Programs Using BEA Statistics: A Look at Unemployment Insurance Benefits Payments. Survey Of Current Business, 91(9), 14-17.

Russo, D. (2012). Unemployment Compensation & Extended Benefits–What Employers Need to Know. Journal Of State Taxation, 30(6), 33-48.

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