Analysis of UI Benefits in Ohio

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Abstract

This report examines benefit payments in Ohio’s unemployment insurance (UI) program. The report compares average recipiency rates and replacement rates with national averages over the past four decades. It then reviews detailed aspects of benefit recipiency including monetary eligibility, first payment rates, benefit duration and replacement rates. The report identifies four areas where access to benefits could be broadened: reduced base period earnings requirements, enhanced eligibility for part-time workers, establishment of worksharing and establishment of self-employment assistance.

Introduction

Benefit payments in Ohio’s UI program are strongly influenced by the performance of the state’s economy. Most obviously, increases in the unemployment rate cause increases in UI claims and benefits. Before examining benefits directly, however, it is appropriate to offer comments on the state’s overall economic performance.

The Ohio economy in 2008 is likely to operate with an unemployment rate (TUR or total unemployment rate) that is some 0.8-1.0 percentage points higher than the national average. The Ohio/U.S. ratio has increased in recent years, reaching 1.22 in 2007, e.g., 5.6 percent versus a nationwide average of 4.6 percent.

To help place recent economic performance into a broader perspective, Table 1 summarizes developments in three important indicators over the past 40 years: the overall unemployment rate (TUR), total employment of UI taxable covered employers and the average weekly wage in covered employment. For each indicator Table 1 shows the 40 year average from 1967 to 2006 and averages for the four ten year periods between 1967- 1976 and 1997-2006. Over the full 40 year period, Ohio’s unemployment rate averaged 6.32 percent compared to the national average of 5.97 percent for a ratio of 1.06. For the full period, taxable employment averaged 4.6 percent of the national average and the weekly wage was 0.979 of the national average.

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The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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