Congress enacted a $600-per-week unemployment insurance (UI) supplement beginning in April 2020, resulting in jobless benefits which exceeded earnings for the typical jobless worker through the end of July 2020. Critics of the policy have suggested that the $600 supplement may have discouraged unemployed workers from searching for jobs. Proponents have argued that generous UI benefits allowed jobless workers to maintain their livelihoods during the pandemic and helped prevent a deeper recession. In this research brief and companion academic paper, we evaluate these claims by documenting the impact of supplemental UI benefits on job finding, spending, and saving of jobless workers between April and July 2020. We find that the $600 supplement likely played little role in discouraging people from finding work. Rather, expanded UI boosted the spending and saving among jobless workers, many of whom are facing extended or repeated unemployment spells.

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Authors

Fiona Greig

Former Co-President

Daniel M. Sullivan

Consumer Research Director

Max Liebeskind

JPMorgan Chase Institute, Consumer Research Associate

Peter Ganong

Assistant Professor at the University of Chicago Harris School of Public Policy

Pascal Noel

Neubauer Family Assistant Professor of Finance at the University of Chicago Booth School of Business

Joseph Vavra

JPMorgan Chase Institute Academic Fellow