UI as a Safety Net for Former TANF Recipients. UI claims among unemployed TANF leavers

03/01/2008

Among those identified as newly unemployed in each of the analysis cohorts we examine patterns of application for UI benefits. Table 8 lists UI application rates for each of the TANF leaver cohorts in the first three years after TANF exit (see also Figure 7). Also, reported in the table is the total number from the cohort experiencing a new spell of unemployment and the total proportion of them applying for UI benefits combined over the three years after leaving TANF.

Figure 7.
UI Application Rates by Year from TANF Exit When First Newly Unemployed

(percent)

Figure 7. UI Application Rates by Year from TANF Exit When First Newly Unemployed (percent). See text for explanation.

Analysis of involvement with UI is restricted to those leaving TANF for employment who subsequently experience unemployment. For the cohorts listed in Table 8, between 16,599 and 63,937 experienced new spells of unemployment. UI application rates range from 17.6 percent to 42.7 percent. In the second year after leaving TANF, UI application rates tend to be higher than in the first year. This may be due to an understanding that adequate earnings are required to qualify for UI benefits and such earnings only accrue after a longer period of labor market experience. There are much smaller differences in UI application rates between the second and third year after TANF exit.(1)

Within states, cumulative UI application rates showed an increase in Florida between 1997 and 2000 cohorts, but were fairly stable over time among the cohorts. There were only small increases in cumulative UI application rates between the 2000 and 2001 cohorts despite the economic slowdown in 2001. A clear ranking of UI application rates over the 3 year period following TANF exit emerges across states. Among newly unemployed TANF leavers, the highest UI application rates were observed for Florida, followed by Texas, Michigan, and Ohio.

 

Table 8.
UI Application Rates (percent) by Year from TANF Exit When First Newly Unemployed
  1997 Cohorts 2000 Cohorts 2001 Cohorts 2003
Texas
All
Cohorts
Florida Texas Florida Michigan Ohio Texas Florida Michigan Ohio Texas
Time from Exit
Year 1 13.8 17.2 35.8 14.2 13.8 18.1 38.9 20.4 15.6 21.5 19.0 19.0
Year 2 42.2 27.0 52.3 32.2 22.4 32.1 50.5 31.5 26.3 33.3 26.4 32.0
Year 3 42.1 29.3 50.2 36.3 28.4 38.1   35.1   36.0 47.4 37.0
 
Unemployed 37,621 63,937 23,755 33,460 44,835 37,072 16,599 28,756 36,515 40,469 43,462 406,481
UI Applicants 10,158 13,616 10,136 7,022 7,885 8,984 7,051 7,089 7,045 10,646 9,128 98,760
Rate (*1, percent) 27.0 21.3 42.7 21.0 17.6 24.2 42.5 24.7 19.3 26.3 21.0 24.3
Note:  (*1) Based on applications for UI benefits relative to the first unemployment after TANF exit. A five calendar quarter period is checked for a new UI claim starting with the quarter before the quarter of new unemployment through three quarters after new unemployment. The UI application date is the first UI benefit year begin (BYB) date in that time period.

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