New Survey of Jobless Workers Reveals How Critical Unemployment Insurance System Falls Short

New York, NY—As businesses and economists increasingly warn of a looming recession, a new report from the National Employment Law Project (NELP) exposes both unemployment insurance’s key role in reducing economic hardship and major deficiencies in the unemployment insurance system that millions of workers will rely on if they lose their jobs. The Unemployed Worker Study, a collaboration between NELP’s Amy Traub and researchers Alexander Hertel-Fernandez and Sanjay Pinto, is based on a survey of 1,480 workers who experienced unemployment at some point from 2019 to 2024.

The report reveals that unemployed workers who receive unemployment insurance (UI) benefits face much less economic hardship than those who do not. Yet workers report a wide range of difficulties in securing benefits, including restricted eligibility and barriers to access. Nearly one in five UI applicants nationwide reported that the benefits they received were not adequate to meet their financial needs. The report includes federal and state policy recommendations, as well as suggestions for employers that want to support workers in accessing benefits.

This study is a wake-up call about the state of our unemployment insurance system.

Key findings:

• UI is a lifeline for jobless workers: Workers who received UI benefits were significantly less likely to report food and housing insecurity.
• Access problems persist after the pandemic: Even after the pandemic unemployment surge ended, UI applicants still faced delayed eligibility decisions (22%), difficulty with UI websites (20%), and trouble reaching UI agencies by phone (21%), among other barriers to access.
• Inadequate benefits: One in five UI applicants said benefit levels were not sufficient to meet their needs. Because states control benefit levels, there was considerable variation between states. In states that offered lower benefits, 25% of UI applicants reported that the support was not adequate.
• A major role for employers: 29% of UI applicants report an employer helped or hindered them in applying for UI. Employers were more likely to help highly paid and educated workers to apply for benefits.
• Racial disparities: Black workers who applied for UI benefits were more than twice as likely to report trouble verifying their identity than white workers.

“This study is a wake-up call about the state of our unemployment insurance system,” said Amy Traub, report co-author and senior researcher and policy analyst at NELP. “The nation may be facing a recession in the coming months, and our research shows that unemployment insurance is still too hard to access and doesn’t adequately support workers who lose their jobs. State and federal policymakers must prioritize strengthening unemployment insurance.”

“It’s rare to get a picture this detailed of the experiences of unemployed Americans,” said Alexander Hertel-Fernandez, report co-author. “The report underscores familiar issues with the UI system, such as the inadequacy of benefits. It also brings attention to new issues that haven’t received as much focus but merit more attention from policymakers, such as the challenges that unemployed workers face in getting clear and timely information about how to apply for benefits and navigate the application process.”

“In a period of great turmoil and economic uncertainty, bolstering the UI system is one of the most important actions policymakers can take,” said Sanjay Pinto, report co-author. “This study highlights UI’s critical role in helping families meet basic needs such as food and housing. It also underscores the urgent need for reforms—to expand eligibility for UI, remove access barriers, and increase benefits levels. That’s how to ensure that all unemployed workers get the help they need.”

The report calls on state policymakers to improve UI benefit levels, duration, eligibility, and workers’ ability to access benefits. States should also reform UI financing. Recommendations for Congress include passing the UI Modernization and Recession Readiness Act to ensure UI is adequate for workers across all states. The bill would also update emergency benefit programs. Both states and the federal government should support innovative programs that reduce barriers to UI access such as peer workforce navigator programs. Employers can support workers by sharing information about how to apply for UI with separating workers, not indiscriminately contesting workers’ UI claims, and making sure employees are properly classified.

For more information and to read the full report, click here.

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