Keeping the Lights On: Why Unemployment Insurance Reform Can’t Wait

In the winter chill of a post-pandemic December in Virginia, I stood in the living room of a woman I’ll call Sonia. The room glowed with Christmas lights—red, green, blue, and yellow—casting a warm hue over garland, figurines, and the faint outline of a chemo port beneath her collar. Sonia had just lost her job. She was also fighting cancer. And her biggest fear wasn’t her health—it was whether she could keep the lights on.

Sonia’s story isn’t an outlier. It’s the quiet, painful reality for thousands of workers across the country. And it’s a window into the cracks in our nation’s unemployment insurance (UI) system—cracks that leave far too many people in the dark.

UI compensation is not a handout. It’s an earned right. Like other forms of insurance, it’s a policy to protect workers, employers, and the economy against risk. It exists to help workers bridge the gap between jobs and to preserve their dignity, stability, and hope during that uncertain time. But for Sonia, that bridge nearly collapsed.

UI compensation is not a handout. It’s an earned right. Like other forms of insurance, it’s a policy to protect workers, employers, and the economy against risk. It exists to help workers bridge the gap between jobs and to preserve their dignity, stability, and hope during that uncertain time.

She received just 16 weeks of UI compensation; four weeks shy of when she finally secured a new job. In those four weeks, she slipped deeper into debt. Her UI compensation didn’t match her previous earnings, and the state didn’t adjust for her city’s cost of living. Sonia is resilient—she worked through surgeries, chemo, and radiation. But no one, no matter how strong, should have to fight that hard to survive unemployment.

And she’s not alone. Unemployed workers and advocates have organized and pushed for common-sense reforms throughout the United States. In my home state of the Commonwealth of Virginia, legislators listened, and they introduced several bold reforms this session to modernize and strengthen the UI system.[1]

Thanks to their hard work, Governor Glenn Younkin recently signed bills that raised the income disregard and increased the UI weekly compensation amount by $52.

While we are celebrating these victories, there is much more we need to do for this important system. UI keeps families afloat, businesses open, and communities stable. Every dollar paid out in UI compensation generates $1.60 in economic activity.[2] So, UI compensation should be robust in both weekly dollar amount and duration.

During the Great Recession and the COVID-19 pandemic, expanded UI compensation helped prevent millions from falling into poverty.[3] It’s a smart investment, especially when layoffs—particularly in the public and federal sectors—are increasingly common.

As Sonia told me before I left her home, “These lights give me a little bit of hope.” Hope should not be a luxury afforded only to the lucky. It should be built into our policies, into our social contract, and guaranteed in our social insurance.

We need to keep the lights on—for Sonia, and for every worker across the country. The time to fix unemployment insurance is not during the next crisis. It’s now.

Endnotes

[1] See Leah Britton, Unemployment Benefits in Virginia Set for Overhaul with New Bills 13 News Now (Feb. 10, 2025 3:50PM), Virginia Senate advances bill to extend and increase unemployment benefits | 13newsnow.com; Dave Ress, Sen. Ebbin Asks General Assembly to Boost Unemployment Benefit Richmond Times-Dispatch (Oct. 9, 2024), https://richmond.com/news/state-regional/government-politics/article_60d743da-865f-11ef-911a-03535f9d6ac9.html.

[2] Mark Zandi, U.S. Macro Outlook: Compromise Boosts Stimulus Moody’s Analytics (Dec. 8, 2010 1:00PM), U.S. Macro Outlook: Compromise Boosts Stimulus : Moody’s Analytics Economic View.

[3] Liana E. Fox and Kalee Burns, The Supplemental Poverty Measure: 2020, Current Population Reports, Census Bureau (September 2021), www.census.gov/content/dam/Census/library/ publications/2021/demo/p60-275.pdf.