Executive Summary

• Updating, modernizing, and improving the Unemployment Insurance (UI) system is a necessary step for ensuring that the United States is well-positioned to protect workers and families against economic shocks – whether from pandemics, trade disputes, wars, automation, artificial intelligence, or ordinary churn in the labor market.
• The UI system fails in three ways – it does not provide claimants with sufficient support to pay their bills while they look for a new job that matches their skills (Assistance), it does not ensure that people who lose their job can reliably access their benefits nor stop fraudulent claims (Access), and it fails to activate claimants to look for new work (Activation).
• Recommendations for improving assistance include setting minimum weekly benefits, increasing standard replacement rates, reforming maximum weekly benefit amounts, and extending the duration of regular benefits.
• Recommendations for improving access include the creation of a federal back-end to enhance the technical and administrative capacity of state UI agencies and the standardization of benefit calculation rules across states to simplify administration.
• Recommendations for improving activation include replacing work-search requirements with a proactive approach emphasizing job-search planning, accountability follow-ups, and periodic counseling, and increased funding for active labor market policies.

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Introduction

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