Who is Covered by Unemployment Insurance?

Abstract

Although the Federal State Unemployment Compensation Program (UI) is designed to insure U.S. workers against the economic risk of job loss, there is little information available about the characteristics of employed workers who are covered by the program (i.e., who would be eligible for benefits if they became unemployed). Knowing more about these workers can improve current understanding of the extent to which the UI program is meeting the needs of workers in the modern economy and can help researchers and policymakers identify ways to make the program more effective. To contribute to research in this area, this paper uses data from the 2008 Survey of Income and Program Participation (SIPP) and probit regression analysis to document rates of UI coverage by major demographic and job groups. I find that 95 percent of employed workers with prior labor-force experience are covered by UI. However, consistent with prior literature on the characteristics of UI recipients, I find gaps in UI coverage for women, younger workers, less-educated workers, part-time workers, and workers in some service-related industries and occupations.