The Role of State Policy in Reducing Disparities in Unemployment Insurance Recipiency

Grant description:

This project will leverage variations in implementation timing of the requirement in the Coronavirus Aid, Relief, and Economic Stimulus, or CARES, Act that employers notify recently separated workers of their eligibility for Unemployment Insurance. It seeks to causally identify whether notification improves the take-up of Unemployment Insurance with an emphasis on Black and Latino workers. The author will compile a database of states’ implementation of required separation notices by employers to employees by state and year. This project is expected to yield credible evidence regarding the efficacy of these employer separation notice requirements on the receipt of Unemployment Insurance. The project will further investigate whether such requirements close the racial divide in receiving Unemployment Insurance. Given known racialized disparities in receiving these benefits, the emphasis on this is critical. The distribution of information on UI eligibility as a mechanism in attenuating (or not) racial disparities would add to policymakers’ understanding of what is driving these disparities. In the case that separation notice requirements increase the take-up of Unemployment Insurance, the project has the potential to identify a relatively low-cost intervention with large payoffs. In the case that separation notice requirements do not improve UI take-up or close racial divides, policymakers may want to reconsider the universal requirements implemented as part of the CARES Act.