There are several indicators used to measure economic activity in the United States that are leaving some employees without unemployment benefits at a time when they have needed them most.
The pandemic has led to historic levels of unemployment. A new study found that some indicators are the percentage of the total employment force claiming unemployment benefits and also the insured unemployment rate (IUR), which are often not adequately responsive to the needs of the unemployed and information systems.
Most states limit the number of weeks that the unemployed receive unemployment insurance. But, as macroeconomic indicators have shown that the economy has worsened, benefits are automatically extended.
A California Policy Lab study concluded that in at least 33 states, up to 30% of the unemployed receiving unemployment insurance benefits have lost access to extended state benefits because of the way unemployment levels are currently measured.
This malfunction occurred when state systems underestimated how many unemployed there might be and when beneficiaries were moved to other federal extended benefit (EB) programs and left out.
When the IUR falls below a specified rate, the systems automatically turn off benefits, leaving hundreds of thousands of Americans without the opportunity to receive weekly checks.
Currently, many researchers estimated that the problem has managed to affect more than 300,000 people who have applied for unemployment benefits and that 33 states could be at risk and affected.
During the fall, Alabama, Maryland, Minnesota, Minnesota, Ohio, South Carolina and Virginia had the problem. This error affected the benefits of about 25,000 workers in Minnesota alone.
How do you fix this problem?
The study asked lawmakers and administrators of unemployment systems in the various states to evaluate the metrics they have used to determine the needs of the economy and the people who lost their jobs.
Some of the states introduced proposed legislation to revamp and modernize unemployment systems to avoid the problems identified in more than half of the states.