The Gendered Effects of Unemployment Insurance on Subsequent Employment Outcomes Among Unemployed Workers with Children

Background

During the current global pandemic, many American workers experience reduced work hours, quit their jobs, or are laid off for reasons related to caregiving for children. The mass unemployment has generated policy debates on UI expansion and its effect on the economic well-being of working families. While some prior studies indicate that UI expansion or benefit receipt decreases workers’ job search and extends unemployment duration (Farber & Valletta, 2015; Regmi, 2015; Schwartz, 2013), others show that more generous UI benefits result in better post-unemployment outcomes (Rebollo-Sanz & Ignacio,2015; Wulfgramm & Fervers, 2015). However, most previous studies conduct gender-neutral analysis, yielding aggregated results for men and women. This study examines the gendered effects of UI benefit receipt on subsequent employment outcomes among unemployed workers with children in the context of the 2009 Unemployment Insurance Modernization (UIM) Act in response to the Great Recession. We ask these questions: Did individual UI receipt and state adoption of UIM provisions (i.e., implementing alternative base periods, accepting compelling family reasons for leaving jobs, and allowing UI claimants seeking part-time work) affect subsequent employment outcomes for the study population? Did these effects differ by gender?

Methods

This study used the panel data from the 2008 Survey of Income and Program Participation (SIPP) and merged it with state UI policy and socioeconomic data. We restricted the sample to workers between 25 and 64 years of age who lived with children and experienced job separation during the survey period from 2008 to 2013 (N=213,672 monthly observations from 4,233 workers). We adopted a difference-in-differences (DD) research design to test the effects of individual-level UI benefit receipt and the state-level UIM provisions on subsequent employment outcomes (e.g., work hours and earnings) after the job loss. To examine the gendered effects of UI, we tested the final DD model for two samples stratified by sex. We also conducted a sensitivity test by stratifying the full sample by different demographic characteristics (e.g., education and children’s age).

Results

Our preliminary analysis showed that the effects of UI benefit receipt and state UIM adoption on post-unemployment outcomes differed by sex, controlling for individual-level and state-level covariates. While UI benefit receipt decreased weekly work hours by 1.5 hours (p<.01) in year 3, it significantly increased monthly earnings by $201 (p<.01) in year 2 and $238 (p<.01) in year 3 for women only. However, we found the gendered effects of UI benefit receipt on post-employment earnings changed by states’ adoption of UIM provisions. For example, implementing a CF adoption significantly increased the effect of UI benefit receipt on earnings ($468, p<.01) for men but marginally decreased the effect of UI benefit receipt on post-unemployment earnings ($185, p<.1) for women.

Conclusion and Implications

Our findings suggest that women’s post unemployment outcomes are more sensitive to UI provisions because women are more likely than men to opt for part-time or less favorable jobs that accommodate for the work-family conflict. Social workers should advocate for future UI provisions that transform but not reproduce gender inequities.