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Three figures from today's @ChloeEast2 and @David_E_Simon paper illustrate some longstanding shortcomings of safety net programs (especially UI) and why the CARES Act UI supplement was such a big deal. https://www.nber.org/system/files/working_papers/w28218/w28218.pdf
Many people don't participate in these programs, even at low incomes, and UI take-up upon job-loss is lowest at low incomes.
On average, UI replaces a relatively small share of earnings lost at job-loss, and other programs (which aren't directly tied to having lost a job) don't add much.
Even at low incomes, where UI benefit caps generally don't limit the share of income replaced, UI+everything replaces less than 30% of lost earnings.
The point of UI is to help people find jobs that meet their needs and make good use of their skills by relieving financial pressure to take whatever they find first just to get by. Living on 20-30% FPL doesn't accomplish that.
Pandemic circumstances are weird in a lot of ways, but hopefully they've made the value of a more generous and inclusive UI system clear.
