Partial Unemployment Insurance Benefits and the Extent of Partial Unemployment

Abstract

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The effect of receiving supplementary UI benefits on unemployment duration

“…He provides evidence on individual workers receiving partial benefits in Wisconsin and finds that workers adjust their part-time work to gain from combined earnings and benefits. Holen and Horowitz (1974) confirmed and strengthened the conclusions reached by Munts. McCall (1996), instead, studies whether the level of the earnings disregard influences an UI recipient's job search behaviour.…”

“…A part-time insured worker is entitled to receive supplementary UI benefits if his working hours are reduced with more than 20% of his average weekly working hours before unemployment. 3 The exhaustion of the entitlement period for supplementary UI benefits depends on whether an individual has a part-time job with or without terms of notice. In the former case, the worker can at the maximum receive supplementary benefit for 52 weeks within 70 weeks.…”

“…In sum, Munts (1970), Holen and Horowitz (1974) and McCall (1996McCall ( , 1997 provide evidence that availability of partial unemployment benefits induces the unemployed to take up subsidized part-time jobs. However, these studies are not informative on whether occupying such jobs subsequently helps unemployed workers find regular full-time jobs and hence reduce the overall duration of unemployment benefit receipt, which is the topic of the present study.…”

Should unemployment insurance cover partial unemployment?

“…Furthermore, many part-time unemployed workers do not actively engage in job search activities on the labor market but rather seek to increase the number of hours they work at their current job [2]. In addition, some part- time workers adjust their labor supply to gain from combined earnings and benefits, and these effects could be widespread [3], [4]. Therefore, it might be even more important to monitor the job search activities of part-time unemployed workers claiming benefits than it is to monitor those of unemployed workers who are receiving benefits.…”

Subsidized temporary jobs: lock-in and stepping stone effects

“… See Munts (1970) andHolen and Horowitz (1974) for early studies of the American partial benefit program.…”