Benefit reforms for inclusive societies in the United States: Income Security During Joblessness

Income security for jobseekers

The COVID-19 pandemic highlighted the crucial role of the Unemployment Insurance (UI) programme for cushioning earnings losses in the United States. It also revived the debate on unequal access to income support, with potentially sizeable coverage gaps for some labour market groups, including women and workers of colour. This report first assesses the accessibility of income support for jobless individuals with past “standard” employment, for different groups of “non-standard” workers, and for workers with different racial and ethnic backgrounds, as well as men and women. In a second step, the report considers to what extent coverage gaps for disadvantaged labour market groups could be alleviated if some of the UI extensions adopted during the pandemic would remain in place, in a non-pandemic labour market. The report concludes that, given comparatively modest out-of-work support provisions in the United States, and robust in-work tax credits, there is space for carefully expanding out-of-work supports without unduly weakening work incentives. Building on the analysis and reform experiences in other OECD countries, it presents reform options for strengthening support for jobseekers, including extending UI to self-employed workers, softening the requirement of involuntary unemployment, “levelling up” benefit amounts and maximum durations across states, and considering the introduction of an unemployment assistance benefit for jobseekers without a recent history of employment.