You might be able to receive a deferral if you cannot work. Some children, husbands, wives, or disabled widows do not need to have worked in the past to collect SSDI. For SSI recipients, however, there are important considerations.
SSI will consider unemployment benefits to be unearned income. This means that your SSI benefit will be reduced by one dollar for every dollar you receive in unearned income. As with welfare, SSI recipients are required by law to apply for any other benefit for which they might be eligible. If there is any question about your ability to work, you may also be required to file an application for unemployment benefits.
GA benefits are temporary and for people who are planning to return to work or are unable to work. When you apply for GA, you must sign a contract with the State of New Jersey, in which you agree to repay the benefits if your SSI application is approved. These benefits will be repaid once your SSI benefits begin. The SSA will send your retroactive benefit check directly to the State.
The State will then take the amount of benefits paid to you and send you any remaining SSI funds. The State can only take the amount of GA benefits that was paid during the time that you were also entitled to SSI benefits. GA may try to collect reimbursement directly from you, since the same contract was signed and remains in effect. If you are no longer income-eligible, you may be terminated from GA. This will usually mean that your household income will substantially increase.
This may make you and your family no longer eligible to receive TANF. It is also important to know that Medicare coverage is different from Medicaid coverage. For more information on the differences between the two programs, go to Health Care. It is also very important to speak with your caseworker to make sure that your children are enrolled in NJ FamilyCare for continued coverage and to determine if you would also be eligible. NJ FamilyCare provides free or low-cost health care coverage to certain children and low-income parents who would otherwise be uninsured.
More information is available by calling or on their website. If you have other questions, or are concerned that you are going to lose your health care coverage, you can call the Health Care Access Project at Legal Services of New Jersey by contacting the number at the end of this article. If you, or another family member, have become eligible for SSDI, it is important to contact the New Jersey Work First office for redetermination purposes.
If you recently lost a job, and have very low income and few resources, you may qualify for both unemployment and welfare benefits. Both unemployment and welfare require you to look for work.
Welfare can grant a deferral from the work requirement as explained earlier if you are unable to work, but the unemployment agency will deny your claim if you are unable to work. The exception to this is if you became disabled after becoming eligible for unemployment, or if you were disabled due to an illness or injury not caused by your job see the unemployment section above. This page location is:. Toggle navigation.
Government Aid and Services. What are the basic eligibility requirements for UI? If you have questions about whether your job is covered, call the Unemployment Insurance Division at one of the call centers listed below. Check the blue pages of your local phone book or contact one of the call centers below to find your local office.
Actively seek employment and periodically report job search efforts unless you are attending a full-time training program approved in advance by the Department. Be available for work and willing to accept a suitable job offer unless you are in an approved training program.
Have lost your job through no fault of your own, or for minor offenses that would not be considered gross or "severe" misconduct. Voluntarily quitting a job without good cause will disqualify you from receiving benefits. Meet income eligibility requirements, which are based on the number of people in your household and household income earned or unearned. Meet WFNJ resource asset requirements. Certain assets are not counted, such as some vehicles, personal items, life insurance, the home that you live in, and some others.
Provide necessary documentation and personal identification, including a Social Security number, for all household members. You will have to cooperate with work requirements or obtain a deferral.
In UI, the other income is typically linked to previous work, e. In contrast, all of family income is considered in administering the means test for UA. Monitoring family income is not simple, especially if a spouse works. In effect, UI acts as a screen for some workers who later move into UA benefit status, but the transition to UA is made by only some of the long term unemployed, i. A priori, UI and UA would be expected to have contrasting patterns of administrative costs.
While UI will review certain types of income for possible offsets against UI payments severance pay and pension benefits , UA has to make a complete assessment of income. Also, changes in income, e. Both have to monitor job search and work availability as conditions for continuing eligibility. Of the two systems, administrative costs would usually be higher under UA because of the costs of monitoring income initial income assessments for new claims and income monitoring for ongoing claims.
These costs would typically exceed the costs of UI initial eligibility determinations which are one-time costs per claim. The costs of monitoring availability and work search are likely to be similar in the two systems. While the administrative costs of UA are likely to be higher, no comparative cost data have been assembled to provide empirical support for this inference. This important issue would be an appropriate topic for a separate inquiry. The two forms of unemployment protection generate problems of labor market disincentives.
However, the disincentive problems in the two systems are different. For unemployment insurance three disincentives can be identified. First, there are entry incentive effects. When the work histories of recipients are studied, a bunching of claimants who satisfy minimum eligibility requirement is often found.
Prior to , Canada based eligibility on previous weeks of employment. Each year a consistent bunching at the minimum weeks threshold was observed. Now that Canada uses hours worked in determining eligibility from to depending on provincial unemployment , a bunching at the minimum hours threshold has been observed.
Second, there may be high replacement rates, i. High replacement rates encourage longer spells in benefit status. Estimates of the size of replacement rate effects differ, but the direction of the effect is clear. As claimants suffer a smaller income loss from unemployment higher replacement rate , they prolong periods of recipiency. At least three factors that contribute to high replacement rates can be singled out.
A compounding of these factors occurs among secondary workers with children who are members of high income families. Third, long potential benefit duration can contribute to increases in actual benefit duration. While empirical estimates vary, each added week of potential duration adds from 0. Unemployment duration has many determinants besides UI potential benefit duration. An increased pace of dislocation and permanent job loss has probably played a role in increased unemployment duration in the U.
Over the past two decades, several measures suggest that average unemployment duration has increased relative to earlier decades. In data from the monthly household labor force survey, median and mean duration of incomplete spells between the s and s both increased by more than 20 percent even though the average unemployment rate was higher in the s. Data from UI programs in the U. The mean in UI data has been higher by about one week in the s compared to the s, and the benefit exhaustion rate has been higher by six to seven percentage points.
The increase in unemployment duration in the U. Average replacement rates are now somewhat lower than in the late s details vary from state to state while potential benefit duration has not increased.
These time series patterns suggest that developments in unemployment duration in the U. An important component of increased unemployment in Western Europe since the early s has been a lengthening of unemployment duration. Several studies have examined the linkage between increased duration and the provisions of the UI systems and other aspects of employment security in these countries.
Since long UI potential duration usually predated the increase in unemployment of the mids, the linkage between UI provisions and increased duration is not transparent. A recent investigation by Blanchard and Wolfers argues that an interaction between institutions, e. Many researchers have found an effect of UI provisions on unemployment duration and additional research on the linkage can be anticipated.
Because UA conditions eligibility on the family income of the unemployed individual, the static labor supply-income framework provides a useful point of departure for a discussion of disincentives. For a given family member, family income is given by:. Thus for a given level of Y, larger families receive larger payments. Low wage workers with both hours of unemployment and hours of employment, could receive a UA payment even with substantial hours worked.
Points 2 and 3 taken together imply that a large share of UA recipients could be working and receiving payments simultaneously. If the guarantee level is set too high in an environment where people have substantial control over their unemployment, UA could encourage a lengthening of unemployment duration. Wives with unemployed husbands, for example, may be less likely to work since their earnings could either make the family totally ineligible for UA or reduce the size of the payment.
Part of the reason for Australia changing to a more individualized UA system in was to encourage work among other persons in families often wives where one member is unemployed. These changes are discussed in Section VII. Empirical evidence supports the presumption of a labor supply effect on other family members.
Terrell, Lubyova and Strapec found that the presence of an unemployed spouse lowered the hazard rate of exit to employment by 72 percent for woman and 82 percent for men in an analysis of data from the Czech Republic. Boeri reports similar findings in data from Poland. Brief consideration of these five points suggests that serious disincentive issues could arise within UA programs. To minimize artificial prolongation of unemployment, the work search activity of UA recipients needs to be actively monitored.
Another disincentive issue could arise from worker-initiated job turnover, i. Quit-to-unemployment flows cause family income to decline. Thus the reason for unemployment may have to be monitored by a UA program and entitlement limited to "acceptable" reasons for unemployment. Youth unemployment may also present problems for a UA program. If new workers can collect UA without demonstrating a substantial job history, some youth might appear as unemployed for purposes of collecting UA when they are not seriously searching for work or engaged in training.
Again, this would present a monitoring problem for UA program administrators. Because UA programs occur with much less frequency than UI programs, there has been less research on disincentive problems in UA. However, another body of literature is relevant, analyses of the work disincentives of welfare programs. That research has emphasized high effective marginal tax rates 8 and poverty traps as impediments to work by the welfare population.
Recent policy initiatives in the U. At a minimum, advocates of UA as a less costly program than UI would have to present cogent responses to questions about disincentive effects in a program that conditions eligibility upon family income.
Payments of unemployment protection benefits can be compared across countries using a common metric. This paper examines benefit payments as a percentage of total wages. Note that the replacement rate in III-1a measures benefit payments relative to the economy-wide average weekly wage.
Since the incidence of unemployment is higher among low skilled workers, the average weekly wage of beneficiaries will be lower than the overall average weekly wage.
Thus RRate in III-1a could be expressed as the replacement rate for beneficiaries times the ratio of their weekly wage to the overall weekly wage. This alternative representation would have the advantage of showing an average replacement rate more directly relevant to labor supply decisions of beneficiaries. A convenient metric for examining the costs of unemployment benefit protections is annual wage and salary payments.
This can be expressed as:. Dividing III-1a by III-2a yields an expression for unemployment benefit costs measured as a fraction of the wage bill:. This benefit cost rate can be expressed as a fraction or as a percentage. The left hand side of expression III-3 is the cost of unemployment benefits expressed as a fraction or percentage of the wage bill.
This cost rate has three determinants: 1 the replacement rate, 2 the share of the unemployed who are compensated and 3 the unemployment rate. The latter is largely a macro phenomenon that reflects the overall functioning of the economy. The replacement rate and the share who receive benefits, in contrast, are influenced by policy choices made by a country.
Statutory provisions and administrative procedures influence both payment levels and the share of the unemployed who receive benefits. Up to this point, note that the discussion of unemployment benefit costs has not distinguished UI from UA payments. Regardless of the kind of unemployment protection offered by a country, total payments can be represented as in expression III Because the expression is generic, it can be helpful in making comparisons between UI and UA and showing the cost of each relative to the total wage bill.
One other feature of expression III-3 should also be pointed out. In the United States, for example, almost 10 percent of weeks compensated by the UI program goes to persons with earnings who receive a so-called partial unemployment benefit.
In Australia, nearly one fifth of UA recipients have earnings in the same period when benefits are being received, and, as will be seen, NBen has exceeded Unemp in some years. In providing unemployment protections, a country may make explicit or implicit decisions regarding the replacement rate and the share of the unemployed to be compensated. This product can be termed a generosity index G. For example, a G of 0.
Countries have wide choice in setting the two components that combine to determine G. Thus the U. Regardless of the system used to provide unemployment protection, UI or UA, the costs of benefit payments per percentage point of unemployment can be characterized with G, the generosity index. The coefficient G also has macroeconomic significance. It is a gradient that shows how much the cost of unemployment protections increases when the unemployment rate changes.
Individual countries may select a smaller or larger G depending upon factors such as affordability and the size of perceived disincentive effects. To make the preceding discussion more concrete, this section displays graphs that illustrate the costs of unemployment protections. The emphasis is on the costs of UI programs. All charts plot benefits as a percent of wages against the unemployment rate.
Chart A displays data from twelve countries in The data are derived from a study by Schmid and Reissert The constituent elements of G, i. Three factors stand out in Chart A. S and the U. The adjusted R 2 in a homogeneous regression across the twelve is The variation across countries is startling.
Arrays from the origin for Sweden and Denmark suggest values of G of 0. The corresponding estimate for Greece is 0. The slope of the highest gradient Sweden exceeds that of the lowest gradient Greece by a factor of about The UI program in the U. While there is federal national oversight of state activities, the federal performance standards relate primarily to the timeliness of administrative determinations.
There are no federal standards affecting benefit provisions such as the minimum benefit, maximum benefit or the statutory replacement rate. As a consequence, benefit generosity varies widely across individual states. Chart B provides a snapshot of UI costs across the states in Data are shown for just eleven states from among the 53 programs.
Several states had costs that fell below 0. Benefit generosity as indicated by the coefficient G is highly varied in the U. The gradient G that links the unemployment rate to the benefit cost rate was highest in states like Rhode Island, Washington, Wisconsin, Alaska and North Dakota slopes of roughly 0.
From the most generous to the least generous states, the incremental cost of UI benefits per percentage point of unemployment rate displayed a range of more than four to one.
When the sources interstate variation in UI costs are examined, variation in the share of the unemployed who are compensated is much more important than variation in the replacement rate. Across 51 state UI programs underlying Chart B, the average value for the coefficient G as determined by a regression was 0. Chart B provides support for the earlier observation that the UI program in the U.
Chart C summarizes the evolution of UI costs in the U. For the two sub-periods and , however, the slopes were 0. Chart C distinguishes the data points from the two sub-periods: Xs for the earlier years to and Rs for the later years.
The predominance of Rs towards the bottom of the envelope of data points is apparent. A formal test for equality of coefficients for the two periods was rejected at the 0.
Literature on recipiency in the U. Chart C shows that decreased recipiency is reflected in UI costs as well. In the early s the program was liberalized, including a major increase in benefit levels. The changes persisted throughout the s and the s, a period when the Canadian unemployment rate increased noticeably relative to the rate in the U. During the s, in contrast, Canada enacted a variety of reforms that have reduced in both the replacement rate and recipiency. The effects of the changes on UI costs are apparent in Chart D which spans the 42 years from to Data points from Hs generally fall towards the top of the data cluster while those from Rs generally fall below the cluster.
Between and the average slope was 0. The slope increased to 0. During the s Canada instituted several changes to restrict UI eligibility and weekly benefits. Statutory replacement rates were lowered for quitters in and the basic replacement rate was reduced from 60 to 57 percent in , to 55 percent in and further reduced in , disqualifications for quits were increased to a fixed 12 weeks in and an indefinite disqualification in , entry requirements were raised from 8 weeks to 10 in , to 12 in and then hours-based eligibility in , potential benefit duration was reduced in , and and a system of person-based experience rating was instituted.
Even with the recent restrictions in Canadian UI, note that the regression line for the s has a slope that is slightly higher than the slope reported in Chart A, 0. Australia has administered a program of unemployment assistance UA for over 50 years. Of the countries where UA is the primary program for unemployment protection, Australia is the largest.
Australia provides a full set of social protections through pensions, allowances and other kinds of support. Over the past two decades, age pensions and UA allowances respectively have averaged about 25 percent and 20 percent of the average male wage.
Age pensions, the largest of the individual programs, are received by over 80 percent of those aged 65 and older. Traditionally, pensions have been provided as federally-supported payments. In the future, public pensions are to be supplemented by superannuation payments from individual accounts financed through payroll-based mandatory employer contributions and voluntary employee contributions.
For persons of working age, there are invalidity permanent disability payments, payments for short term sickness and work injuries, mature age pre-retirement allowances, parenting allowances, support payments for training and higher education and rental subsidies. The philosophy behind the social protection programs is to provide means tested benefits.
Because of its heavy reliance on means testing, Australia is unique within OECD countries in targeting payments to the low income families and individuals. Roughly 70 percent of cash benefits are paid to those in the bottom three deciles of the income distribution. Most OECD countries rely mainly on payroll taxes. Because most payments are income-conditioned in Australia, issues arise in structuring payments so that work incentives are appropriate. Effective marginal tax rates are often high for individuals who contemplate working more to increase their earnings and income.
During the past 40 years certain evolutionary changes have occurred in Australia leading to heightened concerns about family income disparities, labor market outcomes and the structure of the social protection system. Five developments have been particularly noteworthy. Growth of the latter group has prompted a public discussion about "work-poor" families and the exclusion of some from the economic mainstream.
Roughly one job in four is part-time with about 40 percent of women working part-time. Unemployment rates have declined during recoveries but never to levels experienced prior to The percentage was about 5 percent in the late s, but has varied between 20 to 24 percent since In recent years, the median duration of unemployment as measured both in the labor force survey and in UA beneficiary data has hovered around one year. Table 2 displays annual fiscal year data on unemployment and UA benefits.
Between and the estimates of total unemployment ranged between 73, and , representing from 1. Since , in contrast, the annual averages have ranged between , and ,, and unemployment rates have ranged from 7. During the years covered by Table 2, the number of UA beneficiaries has grown even more rapidly than unemployment. In a typical week during the most recent five years there have been as many UA recipients as the number unemployed reported in the labor force survey. Data on UA recipients for recent years indicate that about 20 percent are working and also receiving payments.
This suggests that about 80 percent of the unemployed as counted in the labor force survey receive UA payments. What seems to make this possible is the strong negative effect of long term unemployment on family income.
Among those with long term unemployment, it seems that family income is typically low enough to satisfy the means test for UA eligibility. What appears to be a paradox, i. Estimates of average weekly benefits and average weekly wages also appear in Table 2. UA benefit levels were raised substantially in the early s. Average payments tripled between and and replacement rates increased.
Since the mid s, the maximum payment has been indexed to the CPI with semi-annual adjustments. In most cases, people who use welfare will receive a biweekly or monthly payment. The goals of welfare vary, as it looks to promote the pursuance of work, education, or, in some instances, a better standard of living. Social welfare systems assist individuals and families through health care, food stamps, unemployment compensation , housing assistance, and childcare assistance. In the U. The benefits available to an individual vary by state.
The factors involved can include the family unit's size, current income levels, or an assessed disability. Social welfare systems may go by different names within each state, but they often serve similar functions. This can cause confusion when attempting to compare one state's program to another.
Additionally, the requirements to qualify also vary, depending on the poverty line in a particular state. This allows for adjustments based on the cost of living that isn't based on one standard. An individual that is on welfare is usually provided free or deeply discounted goods and services. The government requires that individuals or families seeking assistance must prove that their annual income falls below the federal poverty level FPL. The FPL is an economic measure of income used to determine whether an individual or family qualifies for certain subsidies or aid.
There is no standardized system for the administration of social welfare programs, which vary state-by-state, are listed under different names, and have different requirements to qualify. Welfare programs are initiatives set up by the government to support the poor, developmentally challenged, and disadvantaged groups.
In the s, President Lyndon Johnson created programs like the Head Start, food stamps, and medicare, all designed to fight what he called "the war on poverty" in America. Fast-forward to the s, former president Ronald Regan slashed welfare budget programs designed to help families and created "welfare to work" programs instituted in 40 states during the s. In welfare reform legislation focused on shifting responsibility to welfare participants and advocating work over general assistance.
In the 21st century, welfare reform and assistance programs continue to expand and change under President Joe Biden's leadership. The U. If someone offers to help you get one, do not give that individual any personal information, it is a scam. Medicaid is a health insurance program geared towards people with low income and the elderly. Pregnant women, children, the disabled, and the elderly who fall below a certain income threshold are guaranteed coverage under the Medicaid program.
Medicaid is only offered to those that meet a specific low-income threshold, and children, who do not qualify for Medicaid, have their own special welfare assistance program called the Child's Health Insurance Program CHIP. Supplemental Security Income is administered by the Social Security Administration SSA and provides public assistance to children and adults living with disabilities like blindness, neurological challenges, respiratory disease, and failure to thrive.
The full list of disabilities that qualify can be found on the social security administration's SSA website. Supplemental Nutrition Assistance Program SNAP , previously known as the Food Stamp Program, is run by each state and provides vouchers to low-income households to buy nutritious and low-cost foods. WIC's offering includes nearly everything a mother and young child needs to thrive up until the age of five.
WIC's services include food, educational class and support, vouchers, and health referrals for pregnant, breastfeeding, and postpartum services. All of these programs are designed to ensure kids get free or reduced-cost breakfast and lunch, when school is in session, and when it is closed for the summer.
By November , a year heavily impacted by the economic crisis and lockdowns, over 21 million households benefited from SNAP vouchers.
This program covers all benefits for children including dental care, plus special needs assistance like physical, speech and language, and occupational therapy providing a strong safety net for children in low-income homes.
Congress created TANF to prevent welfare recipients from abusing the welfare program by mandating that all recipients find a job within two years or risk losing their welfare benefits. The states use their allocated funds to operate their own welfare programs.
However, to receive the federal grant, states must also use some of their own money to fund their individual programs. The housing choice voucher program is a federal program designed to help extremely low-income families, the disabled, and the elderly have access to affordable and liveable, meaning clean, sanitary, and safe, rental homes in safe neighborhoods in the private market. These vouchers are given out by local public housing agencies PHA , who receive the funding for these vouchers from the federally run U.
Individuals and families who qualify for vouchers may live anywhere. These vouchers are not limited to subsidized housing projects but can be used in any residential neighborhood that meets PHA's health and safety requirements.
Voucher recipients must find their own housing under this program, and the housing subsidy is directly paid to the landlord of the renal by the PHA. The family or individual is responsible for paying out of pocket the difference between the market price on the rent and the amount subsidized by the voucher program.
In rare instances and under specific requirements, a family could use vouchers to purchase a modest home in an affordable neighborhood. The earned income tax credit is designed to help low-to-moderate income individuals and families get a tax break.
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