Individuals are considered unemployed when they have attained the working age, are vibrant participants within the workforce, have the operational capability, and are actively looking for a job but can’t secure one. Unemployment negatively impacts the disposable income of families, diminishes purchasing power, decreases employee morale, and erodes an economy’s output.

Today, there has been a dramatic upsurge in unemployment worldwide. For instance, the US unemployment rate escalated to 3.7 percent in August 2022. Fortunately, unemployed individuals can benefit from unemployment benefits, worker’s compensation, welfare, or temporary assistance, among other programs that come in handy in case of unemployment.

Types of Unemployment

There are various types of unemployment. They include:

a. Frictional Unemployment

Frictional unemployment forms the highest unemployment rate, adversely impacting the economy. It occurs due to a non-permanent transition in an employee’s life. For instance, when an individual moves from one city to another and must look for a job. Also, frictional unemployment includes individuals finding their way into the labor market, for example, University graduates.

b. Structural Unemployment

It occurs when compatibility is lacking between the available jobs and the available skills. In this case, there are numerous job opportunities, but the individuals do not have the required skills, and vice versa.

c. Cyclic Unemployment

Minimized demand for goods and services within the economy leads to cyclic unemployment. Therefore, businesses are unable to provide job opportunities.

d. Seasonal Unemployment

Seasonal unemployment happens as various companies tend to offer jobs in various seasons when jobs are available. Individuals become unemployed when such jobs are unavailable in other seasons.

e. Disguised Unemployment

Disguised unemployment doesn’t adversely impact aggregate economic output. It occurs when productivity isn’t high and the existence of wealthy workers who are ready to fill the few jobs.

Unemployment Benefits

Unemployed individuals can benefit from unemployment benefits or unemployment insurance. It is a type of insurance offered by the federal government to unemployed individuals in case they lose their jobs. The money is disbursed weekly. It is only given to individuals who lost their jobs involuntarily.

Although it is a federal law, different states have different programs concerning unemployment benefits. However, all states must adhere to particular guidelines given by federal law. Individuals must be eligible for such benefits in their state’s work and wage requirements, not excluding time worked. The US Department of Labor monitors the entire program and ensures adherence within each state.

Who is Eligible for Unemployment Benefits

Although the program is supposed to help unemployed individuals, not everyone unemployed is eligible for this insurance benefit. For eligibility, you must:
• Have earned at least $5700 in the course of the last four completed calendar quarters
• Have earned 30 times the weekly benefit you would qualify to collect
• You must be a legitimate worker in the US
• Not working, or working for very few hours, though involuntarily
• You are actively seeking a job and ready to commence appropriate work with zero delays after getting a job.

Weekly Eligibility Requirements

To be eligible for benefits every week, you must be:
• Physically in a position to work
• Ready for work
• Actively seeking employment (3 work search attempts)
In some scenarios, you must sign up with the Career Center to undertake compulsory seminars to qualify for the benefits.

Who is not Eligible

You may not qualify for unemployment insurance benefits if you rely entirely on working as:
• You rely on commission while working as a real estate broker or insurance agent
• An autonomous consultant
• A student in a work-study program
• An appointed official
• An individual working for the government in a policy-making and or advisory position
• A member of the legislative or judiciary body

Disqualification from receiving Unemployment Benefits

There are different reasons why an applicant may fail to receive unemployment benefits. They include:

a. Quitting the Job Voluntarily

If the Department of Labor discovers an individual left work voluntarily without proving a good reason, they face disqualification from the benefits.

b. Misconduct

If the applicant was involuntarily relieved of their duties due to misconduct, they would be disqualified from the benefits. Misconduct can either be simple or gross. Simple misconduct is a mistake that is wrong, deliberate, and linked with the individual’s work within the individual’s control. It is an intentional refusal, without good cause, to adhere to the employer’s lawful and reasonable rules.

Gross misconduct is disqualified due to the applicant being involved in a crime of the first, second, third, or fourth degree of a state’s criminal justice code.

Unemployment benefits programs play a significant role by surging consumption among unemployed workers and permitting them to avoid exhausting their assets while unemployed. They also offer considerable support to unemployed workers during a recession, without significant side effects in an increasing period of unemployment or increasing unemployment rate.