Category Archives: Unemployment

235,000 Job Growth in February Is Good News for the Economy, But State and Local Government Job Growth Remains Weak

Source: Lucy Dadayan, Donald J. Boyd, Rockefeller Institute of Government, By The Numbers, March 2017

• Nationally, state and local government employment is 1.5 percent below its prior peak, while private sector employment is 6.4 percent above its prior peak.
• State government employment nationally is 2.5 percent below its peak level and local government employment is 1.3 percent below its peak level.
• State government non-education employment, for services such as corrections, hospitals and other health care, public welfare, and highways, has fared the worst among the government subsectors —- currently, 5.5 percent below its peak even though the population has grown 6.9 percent over the same period.
• Local government education and non-education employment are 2.0 percent and 0.8 percent below their respective prior peaks, while elementary and secondary enrollment has risen by more than 2.0 percent during the same period.
• The only subsector that has grown is state government education employment for universities, colleges, and similar services; here employment is up 1.2 percent above the prior peak, but still far weaker than in previous economic recoveries.
• Although state and local government employment did not decline as much during the Great Recession as private sector employment, it has been recovering far more slowly and has regained the jobs lost to the Great Recession.

Dimick on Other Avenues Unions Can Serve their Members (and Encourage Membership)

Source: Matthew Dimick, Workplace Prof blog, Guest Post, February 23, 2017

…A few weeks ago, OnLabor.org featured a post I wrote about the Ghent system and progressive federalism. At the end of that post, I referred to “other avenues for Ghent-type experiments” beyond the main one discussed in the article, which would require changes in the current federal-state cooperative system of unemployment insurance. Mentioning these “other avenues” prompted several queries from readers, and I will use this opportunity here at the Workplace Prof Blog to talk about those.

First, some background. To remind readers, the Ghent system is a form of union-administered (but government paid-for) unemployment insurance that has a substantial, positive impact on the rate of union membership in the countries that have it. What makes the Ghent system a prospect for union revitalization in the US is the system of unemployment insurance we have here, which basically incentivizes states to adopt, finance, and administer their own unemployment-insurance systems subject to federal guidelines and oversight by the Secretary of Labor. It also helps that states are given more latitude under federal labor law preemption when it comes to the design and administration of unemployment insurance….

Report to the New Leadership and the American People on Social Insurance and Inequality

Source: Benjamin W. Veghte, Elliot Schreur, and Alexandra L. Bradley (eds.), National Academy of Social Insurance, January 2017

From the abstract:
Our nation’s social insurance infrastructure forms the foundation of economic and health security for American workers and their families. Like all infrastructure, it must be periodically strengthened and modernized if it is to continue to meet the needs of a changing economy and society. This Report presents the new Administration and Congress with a range of evidence-based policy options, developed by the nation’s top social insurance experts, for doing so.

The first part of the Report takes stock of the policy challenges facing existing social insurance programs: Social Security, the major health insurance programs, and Unemployment Insurance. The second part discusses potential new directions for social insurance in coping with emerging needs in the areas of long-term services and supports, caregiving supports, and nonstandard work.

America’s male employment crisis is both urban and rural

Source: Alan Berube, Brookings Institution, December 5, 2016

In the wake of the 2016 presidential election, many analysts have interpreted Donald Trump’s victory as the product of economic anxiety among the white working class—particularly in the smaller towns and rural areas that provided his electoral margin in closely contested states like North Carolina, Michigan, Pennsylvania, and Wisconsin.

This piece does not purport to explain why people voted the way they did, or what role economic factors played in their decisions. Rather, it acknowledges that the state of the economy in small-town and rural America highlighted throughout the campaign and after the election surely deserves attention….

Separate and Unequal: The Dimensions and Consequences of Safety Net Decentralization in the U.S. 1994–2014

Source: Sarah K. Bruch, Marcia K. Meyers, and Janet C. Gornick, University of Wisconsin, Institute for Research on Poverty, DP 1432-16, August 2016

From the abstract:
In this paper, we examine the dimensions and consequences of decentralized social safety net policies. We consider the adequacy of benefits and inclusiveness of receipt for eleven federal-state programs that constitute the core of safety net provision for working age adults and families: cash assistance, food assistance, health insurance, child support, child care, preschool/early education, unemployment insurance, state income taxes, cash assistance work assistance, disability assistance, and housing assistance. In the first part of the paper we examine the extent of cross-state inequality in social provision. We find substantial variation across states; variation that is consistent with policy design differences in state discretion; and at levels equal to or greater than variation across the European countries that have been recognized as having different welfare regimes. In the second section, we turn to an analysis of change over time (1994 to 2014) examining four dimensions of convergence: degree, location of change, direction of change, and scope. We find both decreases (retrenchment) and increases (expansions) of provision, a handful of cases of convergence (decreasing inequality) and divergence (increasing inequality), and a great deal of synchronous change and persistence in the magnitude of cross-state inequalities.

The Effects of Unemployment Insurance Benefits: New Evidence and Interpretation

Source: Johannes F. Schmieder, Till Von Wachter, National Bureau of Economic Research (NBER), NBER Working Paper No. w22564, August 2016
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From the abstract:
The Great Recession has renewed interest in Unemployment Insurance (UI) programs around the world. At the same time, there have been important advances in both theory and measurement of UI. In this paper, we first use the theory to present a unified treatment of the welfare effects of UI benefit levels and durations and derive convenient expressions of the disincentive effect of UI. We then discuss recent estimates of the effect of UI benefit levels and durations on labor supply based, to a large extent, on high-quality research designs and administrative data. We relate these estimates directly to the sufficient statistics identified by the model. We also discuss several active and open areas of research on UI. These include the effect of UI on aggregate labor market outcomes, the effect of UI on job outcomes, the long-term effects of UI, the effects of UI under non-standard behavioral assumptions, and the interactions of UI with other programs. While our review of the new experimental estimates confirms the range of negative labor supply effects of the previous literature, we show based on the model that these estimates are imperfect proxies for the actual disincentive effects. We also isolate several important areas in need for additional research, including estimates of the social value of UI as well as the effects of UI in less-developed countries.

How Do Financial Resources Affect the Timing of Retirement after a Job Separation?

Source: Matthew S. Rutledge, ILR Review, Vol 69 no. 5, October 2016
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From the abstract:
This study examines working people between the ages of 50 and 70 years old and the conditions that lead them to decide to retire or not after they experience a job separation. Based on data from the Survey of Income and Program Participation, the author finds that among individuals whose jobless spells end in retirement, most decide to retire within a year after separation. The availability of resources such as Social Security retirement benefits, high net worth, and income from defined benefit pensions appear to encourage more rapid labor force exit and retirement, rather than supporting job seekers during a long search. Perhaps surprisingly, no correlation between retirement and the unemployment rate occurs, but unemployment insurance benefits do delay retirement. These results suggest little tolerance for long job searches regardless of labor market prospects and indicate that those who can afford to retire will do so rather quickly.

Testing Attestations: U.S. Unemployment and Immigrant Work Authorizations

Source: Ben A. Rissing and Emilio J. Castilla, ILR Review, Vol 69 no. 5, October 2016
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From the abstract:
Each year, hundreds of thousands of immigrants seek legal employment in the United States. Similar to many developed countries, the United States has established immigration policies to protect its citizens’ employment. This study empirically assesses, for the first time, the relationship between U.S. workers’ unemployment rates and immigrant work authorization outcomes, as determined by one key U.S. immigration program—the labor certification process. This program explicitly requires that no willing and qualified U.S. worker be available for the job position offered to a foreign worker. Through the analysis of 40 months of labor certification requests evaluated by U.S. Department of Labor agents, the authors find that, ironically, immigrant labor certification approvals are more likely when the quantity of unemployed U.S. workers within an occupation is high, ceteris paribus. Further, because of the U.S. government’s procedure of auditing applications, the authors are able to assess approval differences when government agents reach similar labor certification decisions using 1) employers’ accounts of their own compliance (e.g., “attestations”) or 2) supporting documentation collected when employers are audited. Only for evaluations of audited applications, in support of the literature on accounts and regulation, are approvals less likely when unemployment is high. The authors conclude by discussing the implications of their findings for theories and policies concerning labor market regulation, immigration, and employment.