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BPC Releases New Unemployment Insurance Extension Proposal to Address Program Shortcomings

Washington, DC – Today the Bipartisan Policy Center released a new proposal to reinstate a federal supplemental unemployment insurance benefit and improve the administration of state UI programs. The following is a statement from Shai Akabas, director of economic policy at BPC:

“It’s astounding that weekly UI claims continue to far exceed the worst week of the Great Recession. While the August jobs report showed employment increasing, it mostly reflected temporarily furloughed employees returning to work. Soon, that stream will run dry and we’ll be left with millions upon millions of permanent job losses.

“For this reason, it is urgent that Congress act. Unless lawmakers can agree on how to extend the much-needed federal supplement, many displaced workers with limited employment opportunities will be forced to rely on modest state UI benefits. Moreover, delayed benefit delivery throughout the crisis has meant that far too many have struggled to make ends meet while they await the processing of their claim. This challenge should be addressed in any extension of the federal UI benefit.

“We propose a flat, state-by-state benefit supplement that provides 90% wage replacement for the median-income unemployed worker, with additional funding for states to upgrade their administrative systems and for other COVID-19-related purposes. Such an approach would calibrate UI benefits to wages in different parts of the country, while maintaining simplicity, treating states equally, and providing resources to ensure that the program works better for unemployed Americans moving forward.”

Read BPC’s ProposalHow to Solve Several UI Challenges at Once

Shai Akabas is available for comment.