• Zoe Xie
    Federal Reserve Bank of Atlanta

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Summary:

The COVID-19 pandemic led to an unprecedented expansion in unemployment insurance (UI) eligibility across states. While more than forty states had modified UI rules by the end of March, not all states responded in the same way. In this article, I summarize the changes to state UI rules in response to the crisis and explore factors that have contributed to the variation in states’ responses.

Key findings:

  1. States differ in whether and how they extend UI eligibility to workers who are unable to work due to quarantine, COVID-19 related illness, caring for sick family or at-home children.
  2. The service sector share of employment in a state is positively correlated with extended UI eligibility coverage.
  3. The number of confirmed COVID-19 cases is only weakly correlated with UI eligibility expansion, while the solvency of a state’s UI fund does not limit the expansions.

https://doi.org/10.29338/ph2020-02