Association for Public Policy Analysis & Management

This paper examines and compares a variety of proposals to alter the federal financing structure for unemployment benefits. The severe job loss from the most recent recession created large financing deficits within the state and federal accounts that pay for unemployment benefits. While many states have taken measures to alter their financing to reflect the severity of the shortfalls; the underlying federal financing structure has not measurably changed.   This paper includes a brief history of the current federal financing structure and examines several popular proposals to modify federal financing, including price indexation of the tax base and other changes to the tax schedule.