Wednesday, January 04, 2012

What Americans think about open-ended unemployment benefits

US unemployment has dropped to 8.6 percent. Most US States provide 6 months unemployment benefits but the rules can change according to unemployment levels. The benefits are funded through payroll taxes and are not means-tested. In NZ on the other hand unemployment benefits are means-tested but open-ended. Many Americans however believe that lengthening the availability of unemployment benefits encourages unemployment. Studies have supported this idea. A Reason Poll asked 1,200 people how long they thought benefits should be available for when someone loses their job?

60 percent think a year or less is enough.


Heisenbug said...

It's worth noting that the US unemployment numbers only count people who are actively looking for work and still in receipt of unemployment payments. The real figure is much, much higher.

Chuck Bird said...

I am not certain how US benefits work but I would expect they would get some sort of benefit when the similar to Canada. In Canada where I grew up the amount of unemployment benefit and the time it lasted was variable as were your contributions.

The maximum time could be quite long provided you had been working a long time. It was called unemployment insurance.

When it ran out you got welfare at a lower rate. there was not too much social stigma for being on the unemployment benefit but more on genteral welfare.

Lindsay Mitchell said...

Heisenbug, The US operates a population survey similar to NZ's HLFS. From that they calculate the rate. You said, "...the US unemployment numbers only count people who are actively looking for work and still in receipt of unemployment payments."

That is incorrect.

"Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. Persons who were not working and were waiting to be recalled to a job from which they had been temporarily laid off are also included as unemployed. Receiving benefits from the Unemployment Insurance (UI) program has no bearing on whether a person is classified as unemployed."

Anonymous said...

What's really surprising is that "0 months" should be a separate category.

I'd expect at least 25% of Americans were in the 0 months category - which just goes to show how much more sophisticated the US electorate is from NZ!