Worker Upgrading and the Business Cycle

macroeconomics, worker upgrading, business cycle

The recession of 2001 and unemployment insurance financing

Although the economic downturn of 2001 was one of the mildest of the past fifty years, between 2002-04, several large states experienced difficulties financing their unemployment insurance (UI) programs. Vroman discusses the recession's effects on states experiencing UI funding problems and the borrowing options available when state trust fund reserves are inadequate. Among his findings, Vroman concludes that all of the states that had to borrow had low trust fund balances at the end of December 2000-just before the recession began-and that funding problems have been concentrated among the large states.Unemployment insurance ; Recessions ; Labor market

Unemployment and unemployment compensation from a global perspective

The purpose of this paper is to summarize the presence and importance of Unemployment Compensation in the world today. Summary measures are developed built-up from country-specific detail, and aggregated for the major regions of the world. The paper also summarizes key details about the measurement of unemployment in labor force surveys. After all, it is the volume of unemployment that is crucial in assessing the performance of UC programs: how capable is a countrys UC program in providing short term protection to its citizens against the loss of earnings and income due to unemployment? -- Das vorliegende Papier bietet einen Überblick über die derzeitige Verbreitung und Bedeutung von Arbeitslosenunterstützung in der Welt. Anhand von länderspezifischen Daten werden aggregierte Maßzahlen entwickelt und nach Großregionen zusammengefasst. Zugleich werden auch Schlüsselcharakteristika der Messung von Arbeitslosigkeit in Arbeitskräfteerhebungen dargestellt. Letztendlich ist das Ausmaß der Arbeitslosigkeit ausschlaggebend für die Beurteilung der Leistungsfähigkeit von Programmen zur Unterstützung von Arbeitslosen: Inwieweit ist das System der Arbeitslosenunterstützung eines Landes in der Lage, die Bürger kurzfristig vor Verdienstausfällen und Einkommensverlusten infolge von Arbeitslosigkeit zu schützen?

Unemployment Compensation Recipiency in English-speaking Countries

The paper explores developments in unemployment compensation recipiency rates in the member-countries of the Organisation of Economic Cooperation and Development (OECD) with particular attention to six English-speaking countries. While the generosity of social protection programs can be assessed by looking at both replacement rates and recipiency rates, the paper highlights changes in the latter. The study uses time series data for OECD member-countries from 1959 to 2005. Data for 20 high-income countries are utilized to explore the effects of changes in the statutory provisions of unemployment compensation programs. Again, more detail is presented for the six English-speaking countries.

The Armenian labor market in transition : issues and options

Reform of the labor market in the former Soviet Union (FSU) is essential to increase productivity. The transition of the FSU economies to a market economy must involve a massive displacement of workers, and will entail labor shortages for certain skills. A key challenge will be to reallocate labor at the lowest social costs. The authors identify key labor market issues in Armenia, reflecting on the dilemmas and options policymakers face both in Armenia and elsewhere in the FSU. Armenians are ardent advocates of radical reform and have already made progress in several areas (including successful privatization of land in 1990). But the Armenian transition is taking place in particularly unfavorable circumstances - including a severe energy crisis because of an economic blockade imposed by neighboring Azerbaijan. In Armenia, current labor policies represent a step in the right direction because they leave primary responsibility for finding a job to the individual. The state's role is simply to provide a social safety net and to create an environment that generates jobs. Tangible progress has been made but the adjustment process has just begun and is hindered by inconsistent labor policies - in some areas too radical and in others smacking of the old interventionism. The authors offer several general policy guidelines. Undertake several initiatives, not just one - possibly worker training as well as job search assistance, self employment grants, and temporary public employment. Use some resources to monitor and evaluate interventions to find out what works. Coordinate active policy interventions and the interface between active and passive instruments. Be prepared to change as the macroeconomic environment changes, and take advantage of the current climate. Under high inflation, for example, consider widening the wedge between wages and various cash and in-kind transfers. When inflation abates, consider paying cash benefits on the basis of prior earnings. Above all, be flexible and sensitive to signals and changes in signals. Among policy options, one size does not fit all.Environmental Economics&Policies,Banks&Banking Reform,Municipal Financial Management,Labor Standards,Health Monitoring&Evaluation

Topics in Unemployment Insurance Financing

Vroman warns that states are more at risk for insolvency in the late 1990s than they were in 1990 and that a repetition of widespread and large-scale borrowing of the past is a distinct possibility. He bases this statement on an empirical study that examines historical levels of states\u27 UI trust fund balances between recessions, and the specific methods used to finance trust fund blanaces. These methods include traditional means of financing, tax-base indexing, state reserve funds, and flexible financing such as solvency taxes and legislative response mechanisms. In addition, he addresses the tradeoffs of financing UI debt by either borrowing from the U.S. Treasury or state bond issues.https://research.upjohn.org/up_press/1068/thumbnail.jp

The Funding Crisis in State Unemployment Insurance

Documents UI funding problems and attempts by states to solve them.https://research.upjohn.org/up_press/1123/thumbnail.jp

The History of State UI Financing

Vroman warns that states are more at risk for insolvency in the late 1990s than they were in 1990 and that a repetition of widespread and large-scale borrowing of the past is a distinct possibility. He bases this statement on an empirical study that examines historical levels of states\u27 UI trust fund balances between recessions, and the specific methods used to finance trust fund blanaces. These methods include traditional means of financing, tax-base indexing, state reserve funds, and flexible financing such as solvency taxes and legislative response mechanisms. In addition, he addresses the tradeoffs of financing UI debt by either borrowing from the U.S. Treasury or state bond issues.https://research.upjohn.org/up_press/1068/thumbnail.jp

The Funding Problem

Documents UI funding problems and attempts by states to solve them.https://research.upjohn.org/up_press/1123/thumbnail.jp