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The Employment Service-Unemployment Insurance Partnership: Origin, Evolution, and Revitalization

David E. Balducchi and Christopher O'Leary
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David E. Balducchi: Consultant

No 17-269, Upjohn Working Papers from W.E. Upjohn Institute for Employment Research

Abstract: This study traces the origin and evolution of the partnership between the employment service and unemployment insurance programs in the United States. We examine objectives of the framers of the Wagner-Peyser and Social Security Acts that established these programs. Using primary sources, we then analyze early actions of the architects of social insurance to facilitate cooperation between the two programs to meet economic exigencies, grapple with political cronyism, and surmount legal barriers. We also discuss factors that caused changes in the employment service–unemployment insurance partnership over time. We identify reasons for the erosion in cooperation starting in the 1980s, and explain why ever since there has been a continuous decline in service availability. Reviewing evidence on the effectiveness of in-person employment services for unemployment insurance beneficiaries, we suggest ways to revitalize the employment service–unemployment insurance partnership. We explore the source of Wagner-Peyser Act funding, how it was formalized, then eroded, and how it can be renewed.

Keywords: employment service; unemployment insurance; Wagner-PeyserAct; Social Security Act; social insurance; public policy; Federal Unemployment Tax Act(FUTA); taxable wage base; intergovernmental relations (search for similar items in EconPapers)
JEL-codes: H83 J65 J68 (search for similar items in EconPapers)
Date: 2017-03
New Economics Papers: this item is included in nep-ias and nep-lab
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Chapter: The Employment Service-Unemployment Insurance Partnership: Origin, Evolutioin, and Revitalization (2018)
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