Modernizing Unemployment Insurance—The American Recovery and Reinvestment Act
Signed by President Obama into law in February 2009, The American Recovery and Reinvestment Act includes a number of bold new initiatives that respond to the unprecedented hardship facing jobless workers, including a temporary increase in the amount of UI benefits, new provisions to provide for extended jobless benefits and new help to workers who lose their health care when they are laid off. A key portion of the legislation is the Unemployment Insurance Modernization Act (UIMA), which would go a long way to fill the gaps in the unemployment safety net while also helping to jump start the economy.
The UIMA provides substantial financial incentives for the states ($7 billion) to close the major gaps in the unemployment program that deny benefits to large numbers of hard-working families. In addition, the measure provides $500 million in necessary funding for state agencies to better serve the record numbers of workers now applying for unemployment benefits and seeking to navigate today's challenging job market.
The workforce has changed fundamentally since the unemployment program was created in 1935. Today's labor market is largely made up of low-wage, part-time and women workers, and many more workers find themselves unemployed for much longer periods of time due to globalization and the loss of manufacturing jobs. However, the unemployment insurance program has not kept pace with these new realities of today's economy. The UIMA responds to this critical challenge by rewarding states that adopt innovative and successful eligibility reforms, thus providing benefits to more than 500,000 workers a year who are now falling through the cracks of the unemployment program.
Over the past decade, more than half the states have adopted the innovative policies that qualify for incentive funding under the UIMA. Thus, the UIMA is especially well positioned to build on the momentum in the states to modernize the nation's unemployment safety net. In addition, the UIMA goes a long way to stimulate the economy because unemployment benefits provide $2.15 in economic growth for every dollar in benefits spent by workers and their families on housing, groceries and other basic necessities. Thus, the UIMA will foster both lasting positive reforms and boost the nation's economy to help prevent a more prolonged and deep recession.
State Legislative Updates
NEW December 2, 2009 NELP report documents the unprecendented wave of Unemployment Insurance Reforms fuled by the American Recovery and Reinvestment Act
June 18, 2009 NELP report documents the unprecedented wave of Unemployment Insurance Reforms fueled by the American Recovery and Reinvestment Act
April 22, 2009 NELP testifies in congress, documenting major progress implementing stimulus funded improvements in the states
Learn More about the UIMA
Read NELP's fact sheet on the Unemployment Insurance Modernization Act
Understand how to rebut false assertions by Governors Jindal and others about the UIMA
Take Action in Your State to Implement the UIMA
Introduce legislation in your state implementing the UIMA (Updated February 18, 2010)
Find out what your state needs to do to comply with the UIMA
Learn About Other Key Provisions of the ARRA
(Updated June 7, 2009) Learn how your state can provide additional weeks of extended benefits through new provisions of the ARRA
Concise guide to all the ARRA's unemployment provisions
Read NELP's press release summarizing the key elements of the ARRA
Visit Families USA to learn about new assistance to workers seeking health care through COBRA
US Department of Labor Guidance on UI Modernization and other ARRA Provisions
UI Program Letter 27-09 (January 29, 2010) “Continued Availability of UC Modernization Incentive Payments”
UI Program Letter 04-10 (December 23, 2009)“ Extension of Temporary Provisions - Emergency Unemployment Compensation, 2008, Federal Additional Compensation, and Extended Benefits”
UI Program Letter 14-09 (November 30, 2009)"Special Transfers for Unemployment Compensation Modernization and Administration and Relief from Interest on Advances"
UI Program Letter 12-09 (May 4, 2009)"Extended Benefits Program – Temporary Changes made by the Assistance for Unemployed Workers and Struggling Families Act"
UI Program Letter 11-09 (January 4, 2010) "New Temporary Federal Additional Compensation Program"
Broad Spectrum of Groups Support the UIMA
Read about the broad support for UI modernization
Women's advocates strongly support modernization
Governors support the Unemployment Insurance Modernization Act
Editorial pages support UI modernization
“Unemployment Insurance Deal is Good for Business,” Baltimore Sun, March 1, 2010 (editorial)
“Not Working: State Response to the Unemployed,” Philadelphia Daily News January 13, 2010 (editorial),
"Right Approach to State Aid," The New York Times, March 1, 2009 (editorial)
"What Part of ‘Stimulus' Don't They Get?" New York Times, Feb. 24, 2009 (editorial)
"The Governors and Handouts" The Baltimore Sun, February 24, 2009(editorial)
"Take the Stimulus Money," Charleston Post and Courier, February 24, 2009 (editorial)
UIMA in the News
“Democrats Aim to Boost Benefits,” Journal Gazette, February 18, 2010
“Unemployment Insurance: Updating Virginia’s System” Richmond Times Dispatch, February 17, 2010
“Va. Senate Favors Accepting Stimulus Jobless Funds,” Richmond Times Dispatch, February 10, 2010
“Stimulus Funds for Jobless?,” Omaha World Herald, February 8, 2010
“House OKs Change to Reap $20M in Federal Stimulus Money,” Salt Lake Tribune, February 8, 2010
“Unemployment Benefits Extended to Those Whose Spouse Relocates,” Denver Post, January 31, 2010
“Fed Money Available for Ala. Unemployed,” Birmingham Business Journal, January 29, 2010
“Labor Sec.: $4.1 Billion in Unemployment Funds Still Unclaimed,” WCSC Charleston (NBC Affiliate),
“Benefits for Everyone,” Baltimore Sun, January 26, 2010
“Changes in Jobless Benefits Would Qualify R.I. for Federal Aid,” Providence Journal, January 20, 2010
"Panel Votes to Put California Bill on the Fast Track," Los Angeles Times, March 5, 2009
"Schwarzenegger Agrees to Federal Conditions to Bolster Unemployment Fund," LA Times, February 25, 2009
"Stimulus Bill Would Bestow New Aid to Many Workers" New York Times, Feb. 14, 2009
"Recession Exposes Holes in Jobless Benefits System," Associated Press, February 9, 2009
"Recession Exposes Holes in Jobless Benefits System," Associated Press, February 9, 2009
"Stimulus would bring welcome relief to California," Los Angeles Times, January 28, 2009
"Not your grandfather's workforce, but it's still his unemployment insurancesystem,"Salem (OR) News, January 24, 2009
"States urged to help more jobless workers," Stateline.org, January 21, 2009
