Unemployment Insurance and Employer Layoffs

摘要

The Unemployment insurance (UI) system finances benefits to unemployed workers by taxing employer payrolls in all states and employee earnings in a few states. Benefit payments to unemployed workers reduce their costs of unemployment, and these UI incentives on employment, unemployment and reemployment have been analyzed extensively. The UI financing mechanism also affects firm hire and layoff decisions. Some of these impacts also have been extensively analyzed, particularly including the effects of firm experience rating on both temporary and total layoff unemployment. However, a major limitation of prior analyses of firm behavior is their reliance on either data for individual workers or aggregated data for state-industry categories. The major contribution of the study is to construct and analyze what is, to our knowledge, the first micro data set with detailed information for matched firm-worker records.