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It’s time to rethink unemployment policy

By Gertrude Schaffner Goldberg

Lifeline benefits for millions of jobless workers still hang in the balance. The current debate over whether to maintain benefits for long-term unemployment underscores limitations in unemployment insurance that have plagued this program throughout its history. A breakthrough program when it was enacted in 1935, Unemployment Insurance was an acknowledgement, after centuries of blaming the unemployed for being out of work, that joblessness was usually involuntary and, if so, should be compensated. But for how long?

Initially unemployment insurance benefits lasted only 16 weeks. President Franklin Roosevelt and his relief administrator Harry Hopkins worried that many of the unemployed would exhaust their unemployment insurance benefits before being re-hired. Consequently they envisioned a permanent program, a part of the Social Security Act that would provide jobs to workers still unemployed when their unemployment insurance benefits ran out. Instead, they opted for temporary job creation. The probable reason was political expediency: such a program would have been an admission that extended, mass unemployment was likely to be a permanent feature of the US economy. The temporary solution was the famous Works Progress Administration (WPA) that provided jobs for millions of unemployed men and women until 1941–when wartime employment rendered such domestic job creation unnecessary. However, in the mid-1940s, with demobilization proceeding and unemployment reappearing, New Deal Labor Secretary Frances Perkins pointed out that the problem of extended unemployment had not been solved: that short-term unemployment insurance “stands alone as the only protection for people out of work.”

Unemployed men outside a soup kitchen, 1931, Public Domain via Wikimedia Commons.
Unemployed men outside a soup kitchen, Chicago, 1931. Public Domain via Wikimedia Commons.

The problem persisted, even with regular unemployment insurance benefits lasting 26 weeks, as they do now. Particularly during recessions, workers are often jobless for more than half a year. Currently, nearly four million people have been out of work for 27 weeks or more, down from over six million in 2010. Even in better days, substantial numbers are jobless longer than the half-year limit. Although there are fewer of them, they are no less needy than their counterparts whose extended unemployment occurs during recessions.

In 1970, with unemployment on the rise, Congress addressed long-term unemployment with a permanent Extended Benefit program providing compensation for an additional 13 weeks beyond the regular 26 in states with specified high levels of unemployment. In addition to this permanent program, Congress, from time to time, votes temporary unemployment insurance extensions–twice in 2008, in response to the Great Recession. As unemployment continued to rise in the 1970s, Congress also enacted a public service employment program resembling Depression-era work programs. This Comprehensive Employment and Training Program (CETA) was controversial although it benefited those who got jobs as well as the recipients of their services. It was terminated in 1982 under the Reagan administration, even though unemployment stood at a post-Depression high of nearly 10 percent.

Temporary fixes for long-term unemployment are poor public policies. Does it make sense for millions of Americans to be deprived of useful work and the dignity that goes with it for long periods of time –even if part of their wages is replaced by extended unemployment benefits? And what about the loss to the nation of the goods and services they could be producing?

US unemployment policy needs a permanent, active component. It’s time to revisit the New Deal model of putting the unemployed to work. These programs, as one New Deal historian expressed it, “literally changed the face of the nation.” Unemployed workers built millions of miles of roads and thousands of public facilities–courthouses, schools, playgrounds.. In addition to massive physical infrastructure improvements, they conserved depleted soil, forests and wild life; created works of art; performed in plays and concerts to audiences, many of whom had never experienced live productions; gave music and art lessons to children; established nursery schools; and captured forgotten parts of our history such as the narratives of ex-slaves. In short, unemployed workers both served the nation and earned a paycheck.

The list of the nation’s unmet needs grows longer. With failing schools, crumbling infrastructure, an economy desperately in need of greening how can we afford to continue to throw away the benefits that the unemployed could bestow? Government job creation, if well-planned and administered, could be an important, permanent component of benefits to the unemployed and to the nation. Legislation pending in the House of Representatives such as H.R. 1000, the Humphrey-Hawkins Full Employment and Training Act, introduced by Representative John Conyers (D-MI) would begin to address this problem. While such legislation is being considered, a just and compassionate nation should rescind the callous withdrawal of extended benefits tor unemployed workers and their families.

Gertrude Schaffner Goldberg is Professor Emerita of Social Policy and former director of the Ph.D. Program in Social Work at Adelphi University. She is co-author/editor with Sheila D. Collins of When Government Helped: Learning from the Successes and Failures of the New Deal . Other books include Washington’s New Poor Law: Welfare “Reform” and the Roads Not Taken, 1935 to the Present (2001), with Sheila D. Collins; Jobs for All: A Program for the Revitalization of America (1994) with Sheila D. Collins and Helen Lachs Ginsburg; and three comparative studies of social policy, the latest of which is Poor Women in Rich Countries: Feminization of Poverty over the Life Course (2010). Goldberg is the author of numerous articles on unemployment, job creation, economic inequality, and the welfare state. She is a co-founder and chair of the National Jobs for All Coalition.

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Recent Comments

  1. PCoene

    The idea of a WPA type program is not necessarily a bad one, but it does raise a few questions. The original WPA was formed at a time when the majority of workers were laborers; a service that is much easier for a governmental body to create jobs for. Today, though, what we see is a workforce with a much higher percentage of college educated office workers than ever before; many are not physically cut out for paving roads or construction. Furthermore, most construction work now-days is unionized; I can only imagine how the unions would react if the US govt started paying cut-rates to unskilled workers to do jobs that had previously been reserved for union workers with higher pay and benefits?

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  3. Gertrude S. Goldberg

    Response to P. Coene.

    Thank you for your response.

    The WPA provided much more than construction work. Indeed it employed large numbers of-nurses, school teachers, artists, statistical workers of all kinds, etc. The New Deal job creation model needs to be adjusted to modern conditions, but it clearly was not confined to the type of work that you consider problematic today.

    As economist Philip Harvey points out, national and local governments are mostly service providers-and, being largely under-resourced relative to the needs they address, could well use workers provided by federal job creation programs. The environmental crisis also creates a desperate need for work such as retrofitting to increase energy efficiency. With so many unmet needs, there is no dearth or work that could be done by the millions of men and women who face extended unemployment.

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