Yet Again, America Isn’t Ready for a Recession
The country’s unemployment insurance system isn’t fit for purpose.
Filing for unemployment benefits is no fun.
Photographer: John Sommers II/Getty ImagesMost economists believe that the US is headed for a recession, which could prove to be brutal. Is the country prepared? Judging from the system of unemployment insurance — a crucial support for the jobless and for the entire economy — the answer is a clear no.
America’s basic unemployment benefits were never very generous, and for the most part haven’t kept up with inflation. Over the past two years, only 11 states have increased their maximum payout along with consumer prices, which have risen about 15%. Another 21 haven’t changed it at all; Oklahoma cut it by 10% last year. And it’s not as if 2019 was a high-water mark. Much like on the eve of the pandemic, the system is far from recession-ready today: As of the second quarter of 2022, benefits as a share of workers’ income ranged from 49% in Iowa to just 27% in Arkansas.