Losing your job can be pretty tough, especially in these trying times when most low-income families are struggling to make ends meet.
For some, this means losing access to all of their income, whereas others may experience difficulties when it comes to affording their living expenses.
Either way, it creates a less-than-favorable situation for everyone involved, and the federal government has been trying to solve this issue for years on end.
Thankfully, one solution that did work was the unemployment insurance program, which is essentially a form of safety net for Americans that lose their job, offering them weekly payments for a set amount of time after they’ve become unemployed.
On the other hand, those that quit their job or were fired for a justifiable cause usually won’t qualify for these benefits, and we’ll try to give you a rundown on how these benefits work and what you should expect from them.
Unemployment benefits
This unemployment benefits program is managed at a state level, and workers will have to meet the requirements imposed by the state agency in charge of running the program in order to qualify.
This also includes the amount of time worked at said job, with certain minimums being implemented in order to avoid misuse of the state benefits program.
Usually, these payments are made by the state government, funded by certain payroll taxes dedicated to this program, meaning that this money is coming out of taxpayer wallets.
The payments can last for up to 26 weeks, after which the person is no longer eligible for state assistance, although this number can vary based on the state where you live and where you work.
Carefully research this topic before relying on these payments, as you may not be eligible for state support without even knowing it.
Federal Unemployment Tax Act
Through Unemployment Insurance, Americans can seek cash stipends as long as they’re actively seeking employment, which is yet another measure put in place to prevent abuse of this assistance program.
Even though it’s managed at a state level, every state in the US must abide by federal law which placed certain guidelines regarding these unemployment programs.
Because of this, unemployment benefits are fairly ubiquitous even across state lines, with the US Dept. of Labor being in charge of overseeing the program and ensuring every state is running it correctly.
The weekly payments are designed in a way that allows them to mimic a percentage of the employee’s average wage in their previous place of work, with the money coming from taxes levied on employers across the state.
That being said, certain companies, namely those with a 501(c)3 status, don’t have to pay these taxes and they do not contribute to the program.
Requirements
Currently, there are two main requirements that a former worker must meet in order to qualify for state benefits, one of them being that the applicant must have met state-mandated thresholds for earned wages or time worked in a certain company.
Apart from this, the state must also verify that the applicant had lost their job for causes other than their own, as the existence of a just cause for the firing of an employee immediately invalidates them for the program.
The second requirement is the applicant’s file claims from the state they worked in, which can be completed either through the phone, in-person, or online depending on the applicant’s abilities at the time.
Normally, the approval period takes between two to three weeks, after which the state agency will inform the applicant whether they qualify for state benefits or not.
Defining unemployment
While unemployment may seem simple at face value, a lot of factors go into how a person became unemployed, as well as their status after.
Generally, unemployment is categorized as one of 4 types, those being cyclical, frictional, institutional, and structural, each with its own niche that they apply to.
For example, cyclical unemployment happens during business cycles when certain changes are afoot, mainly things like a recession or a high-inflation climate like the one we’re experiencing now.
Frictional unemployment, on the other hand, happens when an employee is actively seeking out a new employer, whereas institutional unemployment happens due to certain policy changes which may impact whether an employee is allowed to work for a company or not.
Finally, we have structural unemployment, which is created by deep-seated issues and changes to the economy, usually caused by a change in business strategies and technological advancements which make certain jobs obsolete.
Final word
Even if you do lose your job, there’s no need to panic, as the state government has got your back.
That is, of course, if you qualify for unemployment benefits, which can provide you with up to 26 weeks of payments based on the average wage you’ve been receiving in your previous place of work.
This money is funded through taxes imposed on the companies in the state you’re employed in, and it’s directly involved in helping low-income families deal with the financial issues related to loss of employment.
