Friday, September 30, 2022

What Is The Percent Of Unemployment

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Learn How Much You Can Expect In Unemployment Benefits And For How Long

U.S. Economy Adds 678K Jobs In February, Unemployment Down To 3.8 Percent

By Aaron Hotfelder, J.D., University of Missouri School of Law

Unemployment insurance is a joint federal-state program that provides temporary benefit payments to employees who are out of work through no fault of their own. Thanks to the coronavirus pandemic, finding another job is no small feat. In recognition of these tough economic times, the federal government has passed a law that temporarily increases unemployment benefits and extends them for up to 13 additional weeks.

Computing Partial Unemployment Benefits For A Weekly Claim When Income Was Reported

Whenever income is reported on a weekly claim certification, all wages earned in that week are added to other types of income to determine the gross income for the week.

The department uses the partial wage formula to compute whether partial unemployment benefits are payable and if so, what amount should be paid.

It is possible to receive a partial unemployment benefit payment for a week even when your gross income is greater than your weekly benefit rate . However, you will not receive benefits if you work a total of 32 or more hours for all employers in a week you are claiming or if your total gross pay is more than $500.00.

The partial wage formula used to compute partial weekly unemployment benefits is shown below:

  • Subtract $30.00 from the gross income
  • Multiply the remainder by .67
  • Subtract this new amount from your WBR
  • Round the remainder down to the nearest whole dollar. This is the amount of partial unemployment benefits payable for the week.
  • NOTE: The smallest unemployment benefit payment that we will issue is $5.00, so if your calculation results in an amount which is less than $5.00, no payment will be made. In addition, if your total gross pay is more than $500.00 you will not be eligible for a partial unemployment payment regardless of your weekly benefit rate.

    Example: WBR=$200 Gross Income=$250

  • $250.00 minus $30 = $220.00
  • $220.00 multiplied by .67 = $147.40
  • $200.00 minus $147.40 = $52.60
  • Round $52.60 down to $52.00
  • Calculating The Unemployment Rate

    Remember that the unemployed are those who are out of work and who are actively looking for a job. We can calculate the unemployment rate by dividing the number of unemployed people by the total number in the labor force, then multiplying by 100.

    Figure 1. Employed, Unemployed, and Out of the Labor Force Distribution of Adult Population , 2016. The total adult, working-age population in 2016 was 253.5 million. Out of this total population, 151.4 million were classified as employed and 7.7 million were classified as unemployed. The remaining 94.4 million were classified as out of the labor force. As you will learn, however, this seemingly simple chart does not tell the whole story.

    Figure 1 shows the three-way division of the over-16 adult population. In 2016, 62.8% of the adult population was in the labor force that is, either employed or without a job but looking for work. Those in the labor force can be divided into the employed and the unemployed. These values are also shown in Table 1. The unemployment rate is not the percentage of the total adult population without jobs, but rather the percentage of adults who are in the labor force but who do not have jobs:

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    Table 1. U.S. Employment and Unemployment, 2016
    Total adult population over the age of 16 253.5 million
    Out of the labor force 94.4 million

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    How Unemployment Taxes Work

    In brief, the unemployment tax system works as follows:

    • Employers pay into the system, based on a percentage of total employee wages.
    • You dont deduct unemployment taxes from employee wages.
    • Most employers pay both federal and state unemployment taxes.
    • Employers must pay federal unemployment taxes and file an annual report.
    • The tax paid goes into a fund that pays unemployment benefits to employees who have been laid off.

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    The Establishment Payroll Survey

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    When the unemployment report comes out each month, the Bureau of Labor Statistics also reports on the number of jobs createdwhich comes from the establishment payroll survey . The payroll survey is based on a survey of about 140,000 businesses and government agencies throughout the United States. It generates payroll employment estimates by the following criteria: all employees, average weekly hours worked, and average hourly, weekly, and overtime earnings. One of the criticisms of this survey is that it does not count the self-employed. It also does not make a distinction between new, minimum wage, part time or temporary jobs and full time jobs with decent pay.

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    Employment Insurance And Minimum Wage

    There is some evidence that the natural or average level of frictional unemployment increased in the 1960s and 1970s, not only because of demographic changes but also because ofchanges in social legislation. In particular, the major increases in the generosity of unemployment insurance in 1971 are said by somecritics to have induced higher unemployment. However, there is little consensus on the effects of employment insurance on the unemployment rate.

    Some economists have also pointed to higher minimum wages as leading to more difficulty for the relatively unskilled in obtaining both work and on-the-job training. Lack of on-the-job training can make things especially difficult for new entrants to the labour force, particularly the young. Youth unemployment rates have always been higher than the average and it is hardly surprising that initial and early job searches are often more extensive.

    How Can I Estimate My Weekly Benefit Amount

    You can estimate your own weekly benefit amount to see how much you are potentially eligible to receive. To do this, you need to know which calendar quarters will make up your base year.

    Your base year is the first four of the last five completed calendar quarters before the week in which you apply for benefits. For example, if you applied for unemployment benefits on Jan. 20, 2021, your base year would include wages earned from Oct. 1, 2019, through Sept. 30, 2020.

    You could be eligible for an alternate base year claim if you do not have enough hours in that base year for a valid claim .

    When you file your claim here:

    Your base year is the blue-shaded area.

    To estimate how much you might be eligible to receive, add together the gross wages in the two highest quarters during that period, divide by 2, and then multiply by 0.0385 to get your weekly benefit amount.

    The total amount of benefits potentially payable on your claim is found by taking the smaller of:

    • 26 times your weekly benefit amount or
    • 1/3 of the total gross wages in all four quarters of your base year.

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    Labor Force Participation Rate

    Another important statistic is the labor force participation rate. This is the percentage of adults in an economy who are either employed or who are unemployed and looking for a job. People who are unemployed but not currently looking for a job are considered out of the labor force, and are not counted in the labor force participation rate. So, using the data in Figure 1 and Table 1, those included in this calculation would be the 159.2 million individuals in the labor force. The rate is calculated by taking the number of adults in the labor force, divided by the total adult population and multiplying by 100 to get the percentage. For the data from 2016, the labor force participation rate is 62.8%. In the United States, the labor force participation rate is usually around 66-68%, though it has declined over the last decade.

    Unemployment In The Eu And The Euro Area

    Kern County unemployment rate drops one percent since last month

    Eurostat estimates that 13.066 million men and women in the EU, of whom 11.004 million in the euro area , were unemployed in May 2022. Compared with May 2021, unemployment decreased by 2.515 million in the EU and by 2.165 million in the euro area.

    In May 2022, the euro area seasonally-adjusted unemployment rate was 6.6 %, down from 6.7 % in April 2022 and down from 8.1 % in May 2021. The EU unemployment rate was 6.1 % in May 2022, stable compared with April 2022 and down from 7.3 % in May 2021.

    are available here.

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    About State Unemployment Tax

    When you have employees, you must pay federal and state unemployment taxes. These taxes fund unemployment programs and pay out benefits to employees who lose their jobs through no fault of their own.

    Generally, unemployment taxes are employer-only taxes, meaning you do not withhold the tax from employee wages. However, some states require that you withhold additional money from employee wages for state unemployment taxes .

    State unemployment tax is a percentage of an employees wages. Each state sets a different range of tax rates. Your tax rate might be based on factors like your industry, how many former employees received unemployment benefits, and experience.

    State unemployment taxes are referred to as SUTA tax or state unemployment insurance . Or, they may be referred to as reemployment taxes .

    You pay SUTA tax to the state where the work is taking place. If your employees all work in the state your business is located in, you will pay SUTA tax to the state your business is located in. But if your employees work in different states, you will pay SUTA tax to each state an employee works in.

    States also set wage bases for unemployment tax. This means you only contribute unemployment tax until the employee earns above a certain amount.

    Unemployment Effect On The Economy

    The unemployment rate is a lagging indicator, or an indicator of how an economic event affected employment during a certain time period. For example, a recession is an economic event, and high unemployment rates are the lagging indicator of the effects of the recession. This also indicates that unemployment will steadily rise for a period of time even after the recession is over.

    Additionally, the Federal Reserve uses the unemployment rate to gauge the overall health of the economy when it establishes a monetary policy. This policy is used to manage economic growth, inflation and unemployment.

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    Common Occurrences For Employees In California You May Be Entitled To Further Compensation

    Did you know that many unemployed people may have suffered from labor violations such as wrongful termination, workplace discrimination, unpaid overtime, unpaid wages, missing breaks, and other labor violations during their last employment? We know that you are here for different information, but we also want you to know that you MAY be entitled to compensation due to labor violations during your last employment.

    If you feel like you were wrongfully terminated then please dont hesitate to schedule a 100% FREE consultation or click HERE.

    If you feel like you were discriminated against in the workplace then please dont hesitate to schedule a 100% FREE consultation or click HERE.

    If you feel like you are owed unpaid wages from a previous employer then please dont hesitate to schedule a 100% FREE consultation or click HERE.

    Can my unemployment benefits be reduced?

    If you earn wages, whether as an independent contractor or as an employee, while collecting unemployment benefits, your benefits will be decreased by a part of the total earnings

    For example:

    • If you will earn below under $100 in a week, then your benefits for that particular week will be deducted by the number of wages in excess of approximately than $25.
    • If you will earn greater than $100 in a week, then your benefits for that particular week will be deducted by approximately 75% of weekly wages.

    Benefits are reduced for the week in which wages were earned, even if they were not paid until a later date.

    How To Get Your Suta Tax Rate

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    When you become an employer, you need to begin paying state unemployment tax. To do so, sign up for a SUTA tax account with your state.

    You can register as an employer online using your states government website. You might also be able to register for an account by mailing a form to your state. Each state has a different process for obtaining an account. Check your states government website for more information.

    To register for an account, you need to provide information about your business, such as your Employer Identification Number. When you register for an account, you will obtain an employer account number.

    Once registered, your state tells you what your SUI rate is. And, your state also tells you what your states wage base is.

    Many states give newly registered employers a standard new employer rate. The state unemployment insurance rate for new employers varies.

    Some states split new employer rates up by construction and non-construction industries. For example, all new employers receive a SUTA rate of 1.25% in Nebraska, and all new construction employers receive a SUTA rate of 5.4% in 2022.

    If you live in a state that doesnt use a standard new employer rate, you must wait for your state to assign you your starting rate.

    Your state will eventually change your new employer rate. The amount of time depends on the state. You may receive an updated SUTA tax rate within one year or a few years. Most states send employers a new SUTA tax rate each year.

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    Estimate Your Own Wba

    • Identify the two highest quarters in your base year.
    • Key each total in the boxes below.
    • Press Calculate to see how much you are potentially eligible to receive.
    • To try again, press Clear and start over.

    Keep in mind that this is just an estimate of your weekly benefit amount. Your actual weekly benefit amount may be different when you file your claim.

    *$295 is the minimum weekly benefit amount payable.**$929 is the maximum weekly benefit amount payable.

    Who Is Eligible For Unemployment Insurance

    These are the qualifications for an individual to qualify for unemployment insurance benefits:

  • must have lost his/her work through no fault of his or her own
  • must have the ability to work, the availability to work, and is actively seeking work and
  • must have earned a minimum amount during a base period before losing their job.
  • States apply these general criteria differently. For example, some states do not include part-time workers unless they are willing to undertake a full-time job, while other states allow these workers to qualify even if they are looking for another part-time job. Also, states have the choice about the length of the base period of employment used to determine eligibility.

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    Criticisms Of Measuring Unemployment

    There are always complications in measuring the number of unemployed. For example, what about people who do not have jobs and would be available to work, but have gotten discouraged at the lack of available jobs in their area and stopped looking? Such people, and their families, may be suffering the pains of unemployment. But the survey counts them as out of the labor force because they are not actively looking for work. Other people may tell the Census Bureau that they are ready to work and looking for a job but, truly, they are not that eager to work and are not looking very hard at all. They are counted as unemployed, although they might more accurately be classified as out of the labor force. Still other people may have a job, perhaps doing something like yard work, child care, or cleaning houses, but are not reporting the income earned to the tax authorities. They may report being unemployed, when they actually are working.

    Although the unemployment rate gets most of the public and media attention, economic researchers at the Bureau of Labor Statistics publish a wide array of surveys and reports that try to measure these kinds of issues and to develop a more nuanced and complete view of the labor market. It is not exactly a hot news flash that economic statistics are imperfect. Even imperfect measures like the unemployment rate, however, can still be quite informative, when interpreted knowledgeably and sensibly.

    How Much Can I Get Each Week

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    In Washington state, the maximum weekly benefit amount is $929. The minimum is $295. No one eligible for benefits will receive less than $295, regardless of their earnings.

    The actual amount you are eligible to receive depends on the earnings in your base year. We calculate your weekly benefit amount and maximum benefits payable by using the wage information reported to us by your employer.

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    Unemployment Effect On The Individual

    Unemployment also affects individuals by increasing or decreasing the competition when looking for a job. The more people that are looking for work, the more competition you will have when searching for and applying for a position. The unemployment rate also informs you of how much leverage you may have when , benefits and other factors of a new job.

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    Why Might The Historical Link Between Unemployment And Poverty Be A Misleading Way To Look At Todays Numbers

    When people become unemployed, they lose an important source of income and are at risk of falling into poverty. Of course, the more generous unemployment insurance is, the less likely it is for someone who loses a job to become poor. But unemployment insurance has typically replaced only about 40 percent of lost wages, on average, over the past 20 years, with a lot of variation in generosity across the states.

    The federal response to the pandemic changed that. The CARES Act, for instance, added $600 a week to weekly unemployment insurance benefits through the end of July 2020, preventing many families from falling into poverty, and the December extension provided for an additional $300. And, of course, Congress provided two rounds of one-time payments for most families$1,200 per adult and $500 per dependent child in the spring of 2020 and another $600 per individual in December, with payments phasing out for higher earners. Estimates suggest that about 13 million people were prevented from falling into poverty by these efforts.

    Acknowledgments:

    The author thanks Francisca Alba for research assistance and Becca Portman for graphic design.

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    • Copyright 2022 The Brookings Institution

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