UNEMPLOYMENT-INSURANCE IN THE UNITED-STATES - LAYOFF INCENTIVES AND CROSS SUBSIDIES

We survey unemployment insurance (UI) in the United States and provide new evidence on the UI payroll tax. Most UI receipt is due to firms t hat pay part of the UI costs of their layoffs, but weak experience rat ing leads most firms to pay considerably less than the full costs. Ind ustries consistently receiving subsidies from the UI system are constr uction, manufacturing, and mining. Finally, a large fraction of layoff s resulting in payment of UI are made by firms that are not charged fo r the costs of the claim because they have employed the individual for less than 2 quarters.