Unemployment Benefits Kept 400,000 People Out of Poverty In 2022

New Analysis from NELP Highlights Impact of Unemployment System Despite Downgraded Capacity

Nationwide—A National Employment Law Project (NELP) brief published today analyzes just-released U.S. Census data, highlighting the impact that unemployment insurance (UI) had in enabling hundreds of thousands of workers and their families—particularly people of color—to avoid poverty in 2022 as they looked for new jobs.

The NELP brief describes how unemployment benefits prevented 400,000 people, including 116,000 children, from experiencing poverty in 2022. This compares to 2.3 million people who remained above the supplemental poverty level because of UI benefits in 2021. NELP’s analysis concludes that unemployment benefits had a smaller impact on poverty in 2022 for two reasons. As the economy recovered in 2022, fewer workers were unemployed. Yet unemployment benefits also reached a smaller share of the workers who were unemployed, largely because of the expiration of federal pandemic unemployment programs that had dramatically expanded eligibility, benefit levels, and duration.

“The fact that unemployment benefits enabled 400,000 workers and family members to avoid poverty in 2022 despite the dramatically reduced capacity of the system is a sign of how powerful unemployment insurance can be,” said Rebecca Dixon, president and CEO of the National Employment Law Project. “Policymakers at the federal and state levels must build a UI system that will support all workers at all times, giving workers the resources to not just avoid poverty, but to thrive.”

The brief includes recommendations for Congress and state policymakers to improve UI systems.

Read the policy brief: Unemployment Insurance Had Less Capacity to Cut Poverty in 2022