A comprehensive analysis of sex and race inequities in unemployment insurance benefits

Journal of Sociology and Social Welfare, Dec, 2003 by Melissa Latimer

This research makes a unique contribution to the growing body of literature on the welfare system by examining the relationship between sex, race, and social insurance benefits in a rural state. Using data from the West Virginia Unemployment Compensation Program, this research investigates sex and race differences in (1) monetary disqualifications for unemployment insurance (UI) benefits and (2) separation issue and nonseparation issue disqualifications of UI benefits. The analyses indicate that unemployed women, people of color, younger, and low income workers are the most likely to fail the monetary qualifications for UI benefits and to lose qualified weeks of UI benefits.

Keywords: gender, inequities, racial inequities, unemployment, unemployment insurance, benefits, distribution of benefits, social insurance benefits

Introduction

An individual's occupation determines his or her social status, income, potential for advancement, type of benefits, the potential for unemployment, and even the resources available to them if they become unemployed. The type of jobs available to workers in the United States has changed drastically over the last 25 years. High-wage manufacturing jobs have been steadily replaced by part-time, contingency, and/or service employment (Schram 1995; Wilson 1997). Jobs in the service industry are known for their minimum wage dependence, lack of unionization, limited job benefits, and limited job security. Consequently, as the service sector continues to grow, so does the potential economic vulnerability and hardship of our labor force.

The Unemployment Insurance (UI) program is one part of the welfare system that is supposed to address the problems associated with such labor market vulnerability. The question many social scientists have raised is the overall effectiveness and fairness of this program, particularly for women and people of color (Amott 1990; Bassi and McMurrer 1997; Bingham 1995; Blaustein 1993; Gordon 1994; Latimer 1999; Maranville 1992; Mink 1990; Nelson 1990; Pearce 1990; Pearce 1986; Pearce and McAdoo 1981).

This research project makes a unique contribution to the growing body of literature on the welfare system by examining the relationship between sex, race, and social insurance benefits for unemployed West Virginia workers. The primary purpose of this research is to investigate state level trends in receipt of unemployment insurance (UI) for workers who are unemployed and have applied for UI in West Virginia in 1997. Using the feminist scholarship on the welfare state as the overall theoretical framework, this research investigates sex and race differences in (1) unemployment insurance qualification (i.e., whether or not workers monetarily qualify for unemployment insurance benefits once they become unemployed), (2) separation issue disqualifications of UI benefits (i.e., losing eligible weeks of benefits because they voluntarily quit their job, were fired for misconduct, etc.), and (3) nonseparation issue disqualifications of UI benefits (i.e., losing eligible weeks of benefits because they failed to register for work did not accept suitable employment, etc.).

There are several reasons why extensive state-level data are required for this research. First, the major monetary qualification for UI benefits (i.e., the minimum earnings requirement) is state specific (Nicholson 1997). Second, variations in UI receipt may be partly a function of state government policy on unemployment insurance and local variation in administration. Thus, national level data obscures the discretionary power of individual states. In addition, national samples typically do not contain enough cases from rural states to analyze the issues. Even with large data sets that oversample disadvantaged workers (i.e., the National Longitudinal Surveys of Youth-NLSY), many critical questions are left unanswered because the data sets are not designed to examine patterns in UI receipt.

Research on a rural state's social insurance program is particularly significant given (1) the majority of the research on poverty and the welfare system has focused on poor families in urban areas (Rural Sociological Society Task Force 1993), (2) the poverty rates in rural areas are consistently higher than those in urban areas and these rates are not declining (Zimmerman et al 1999), (3) researchers have already documented rural deficits in public assistance benefits (Amott 1990; Pearce 1989; Rank 1994; Tickamyer et al. 1993), (4) economic inequality has grown over the past 25 years (particularly the socioeconomic gap between rural and urban areas) while the actual percentage of workers qualifying for unemployment insurance benefits has declined, and (5) one of the best ways to test the UI program (i.e., a program designed to provide income security to displaced workers) is to examine its effectiveness in helping economically vulnerable workers in a rural state with consistently the highest unemployment and poverty rates in the nation.