Unemployment to reemployment: An idea to modernize the safety net for the digital age
The basic tenets of Unemployment Insurance (UI) have changed little since the program was enacted during the Great Depression. It was built as a bridge for workers between jobs in similar industries that required similar skills. You lose your job and a weekly check tides you over until you land a new one, usually doing the same type of work as before. But now, new jobs being created are dramatically different than the ones going away, and workers are struggling to keep up with this change and chart a career. Unemployed workers often need help acquiring new skills and navigating the increasingly complex job market. Some also want to work in a new place but need help with moving costs. Yet the existing safety net offers shockingly little to help them with these modern problems, especially compared to systems in other advanced economies. Reemployment is a 21st century replacement for Unemployment. The program would continue as a universally available earned benefit, offering a temporary income to laid-off workers who paid into the system. But it reinvents Unemployment for a modern economy with the following large, structural changes: Expanded eligibility so all workers have access—including those doing contingent (aka gig) work. Workers would continue to receive income support along with one of three new supports: A universal training voucher—redeemable for certified programs run by community colleges, unions, non-profits, or employers—to replace smaller, existing training programs tied to worker displacement. A job search stipend to help defray the cost of finding new employment for workers who want to pursue work opportunities elsewhere in the country. A bonus if a worker lands a new job before their income support expires. On top of that, all older workers who accept new employment at wages significantly lower than their previous job would be eligible for wage insurance. Together, Reemployment’s suite of benefits would obviate the patchwork of outdated retraining programs scattered across government. Labor productivity and workforce participation would rise. Most critically, it would transform Unemployment from solely a safety net into a springboard to work and higher pay.