The Employment Service-Unemployment Insurance (ES-UI) partnership is rooted in permanent authorizing statutes, an identical fund source, common rules for state administration, and interdependent practices to guard against improper payments and expose claimants to suitable job openings. This partnership is central to the success of the public workforce system. Over the past several decades, USDOL has neglected strengthening the UI-ES partnership, despite research evidence that demonstrates its value to reducing unemployment durations. During recent recessions, federal policies have increased emergency unemployment benefits and job training but by and large ignored long-term underfunding of Wagner-Peyser Act ES grants. As a result, Congress has been inattentive to the inadequacy of ES finances. Correspondingly, in many instances state governors and some advocacy groups have overlooked their roles in promoting the UI-ES partnership and increasing ES grants.
In this study, we explored the origin and objectives of the ES-UI partnership. We reviewed the actions in the early years by the ES and UI framers to forge an interdependent relationship between the two programs. In the beginning, creative financing and strict rules for professionalism were required to properly launch employment security programs. A statutory system for cooperation and financing was set by 1960, but it has atrophied—along with the ES and UI partnership—mostly because of inattention and underfunding of the ES program. We reviewed recent research that demonstrates the effectiveness of employment services and the reliance of the ES and UI programs on each other to achieve social insurance principles. We described how amendments to the Wagner-Peyser Act in WIOA broadened ES activities, and we proposed a path to revitalizing the long-standing ES-UI partnership.
Chosen excerpts by Job Market Monitor. Read the whole story at “The Employment Service-Unemployment Insurance Partnership: Origin, Evo” by David E. Balducchi and Christopher J. O’Leary