Firms and Unemployment Insurance Take-up

Marta Lachowska, Isaac Sorkin and Stephen Woodbury

No 30266, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use administrative data to quantify the employer’s role in unemployment insurance (UI) take-up. First, there are employer effects in both claiming and appeals, and, consistent with deterrence effects, these are negatively correlated. Second, low-wage workers are less likely to claim and more likely to have their claims appealed than median-wage workers, and employer effects explain a large share of these income gradients. Third, high-claiming and low-appealing employers are desirable employers: they are higher-paying and have lower separation rates. Finally, the dominant source of targeting error in the UI system is that eligible workers do not apply. Our findings emphasize a novel dimension of the role of employers in the labor market, and have implications for the financing of UI.

JEL-codes: H32 J30 (search for similar items in EconPapers)
Date: 2022-07
New Economics Papers: this item is included in nep-lma
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