We provide new evidence on the effect of the unemployment insurance (UI) weekly benefit
amount on unemployment insurance spells based on administrative data from the state of Missouri covering the period 2003-2013. Identification comes from a regression kink design that exploits the quasi-experimental variation around the kink in the UI benefit schedule. We find that UI durations are more responsive to benefit levels during the recession and its aftermath, with an elasticity between 0.65 and 0.9 as compared to about 0.35 pre-recession.
Pauline Leung
Recent efforts to expand unemployment insurance (UI) eligibility are expected to increase low-earning workers’ access to UI. Although the expansion’s aim is to smooth the
income and consumption of previously ineligible workers, it is possible that UI benefits simply displace other sources of income. Standard economic models predict that UI delays reemployment, thereby reducing wage income. Additionally, low-earning workers are often eligible for benefits from means-tested programs, which may decrease with UI benefits. In this paper, we estimate the impact of UI eligibility on employment, means-tested program participation, and income after job loss using a unique individual-level administrative data set from the state of Michigan. To identify a causal effect, we implement a fuzzy regression discontinuity design around the minimum earnings threshold for UI eligibility. Our main finding is that while UI eligibility increases jobless durations by up to 25 percent and temporarily lowers receipt of cash assistance (TANF) by 63 percent, the net impact on total income is still positive and large: In the quarter immediately following job loss, UI-eligible workers have 46-61 percent higher incomes than ineligibles.
We examine whether the recent expansions in Medicaid from the Affordable Car Act reduced
“employment lock” among childless adults who were previously ineligible for public
coverage. We compare employment in states that chose to expand Medicaid versus those that
chose not to expand, before and after implementation. We find that although the expansion
increased Medicaid coverage by 3.0 percentage points among childless adults, there was no
significant impact on the employment.
While policymakers often promote further education for displaced workers, evidence on its effectiveness in the U.S. context primarily comes from evaluations of specific government sponsored training programs, which only represent one narrow avenue for skill acquisition. This paper studies the returns to retraining among unemployed workers, where retraining is broadly defined as enrollment in community colleges, four-year institutions, and technical centers. We link together high quality administrative records from the state of Ohio and estimate the returns using a matching design in which we compare the labor market outcomes of similar workers who do and do not enroll. Our matching specification is informed by a separate validation exercise in the spirit of LaLonde (1986), which evaluates a wide array of estimators using a combination of experimental and non-experimental data in a setting similar to ours. We graphically present the average quarterly earnings trajectories of the enrollees and matched non-enrollees over a nine-year period and show that there is little difference in earnings pre-enrollment, followed by temporarily depressed earnings among enrollees during the first two years after enrolling, and sustained positive returns thereafter. We find that enrollees experience an average earnings gain of seven percent three to four years after enrolling, and that the returns are driven by those who switch industries, particularly to healthcare.