Brendan Moore

Unemployment Insurance (UI) provides income support during job loss, yet take-up remains puzzlingly low, with only about half of eligible unemployed workers in the U.S. claiming benefits. We implement a large-scale field experiment among 50,000 recently unemployed, non-UI claiming workers in Washington State to study the causes and labor supply implications of incomplete take-up. The feature of the data that allows us to distinguish between misperception of eligibility and hassle costs is the effect of treatment on the UI rejection rate of those induced to apply. We experimentally vary whether letters include a destigmatizing message. Informational letters increased UI applications by 80% (1.5 percentage points) relative to control, with effects concentrated among low-wage workers. We attribute the effect of generic informational letters on take-up to reduced hassle costs rather than improved eligibility perceptions. Destigmatizing letters induced more applications only from high-wage job seekers. Despite higher take-up, we can rule out negative effects of UI receipt on job search duration.

Unemployment Insurance (UI) policies serve the crucial role of providing fiscal support for a fragile economy by enabling jobless workers to continue paying bills and putting food on the table for their families. The program is one of the most prominent and commonly-used automatic stabilizers in the United States, as Congress has enhanced benefit generosity in every recession since World War II. Most recently, the UI program provided workers who lost their jobs during the COVID-19 recession with extended benefits through the summer of 2021, including intermittent supplemental benefits. The liquidity offered by UI benefits not only allow job seekers survive the hardship of unemployment, but also symbolizes the government’s commitment to helping those in need during a downturn.

Despite UI’s prominence to economic well-being and public trust, the program's effectiveness is contingent upon eligible individuals' willingness to claim the benefits they are entitled to. UI take-up rates in the United States—the fraction of eligible unemployed workers who claim benefits—are highly incomplete, ranging between 40% and 65%. This research delves into the psychological and informational barriers that potentially undermine this willingness, exploring how these barriers relate to broader issues of trust in government and democratic engagement. It then asks how the government can address these issues of misperception or trust that leads to disparities in UI access. I will answer these questions about causes and policies to increase take-up through a customized survey of unemployed workers and an accompanying survey experiment. I seek to understand the mechanisms behind non-receipt and ways for effectively boosting them to enhance worker well-being.