How much unemployment will I get? That depends on your state

Americans are filing for unemployment benefits in record numbers as the coronavirus pandemic continues to crush the U.S. economy.

Those applying for jobless benefits likely have two simple questions: How much money will I get, and for how long will I get it?

Unfortunately, the answers aren’t so simple. And they depend on the state where you were employed.

Here are some ways benefits can differ around the country.

Unemployment insurance claims are generally filed with the state in which someone worked.

The average person receives $378 a week in unemployment benefits, according to U.S. Labor Department data as of year-end 2019.

But that figure masks wide variation among states.

Mississippi, the least generous state, paid an average $213 a week. Massachusetts, the most generous, paid $555. That means the typical jobless person in Massachusetts gets $1,368 more per month than in Mississippi.

The $2 trillion economic relief act, signed into law March 27, significantly expanded unemployment benefits.

For one, it adds $600 a week to existing state benefits through the end of July.

So, those same workers in Mississippi and Massachusetts can expect weekly payments of roughly $813 and $1,155 — increases of 282% and 108%, respectively, when compared with the prior status quo.

But average payments don’t provide the whole picture. States put floors and ceilings on weekly benefits.

Prior to the relief act, those minimums could range from as low as $5 a week in Hawaii to as high as $188 a week in Washington state. The law upped the ante — states now pay, at a minimum, half their average weekly payout (plus the extra $600 a week through July).

In Hawaii, that $5 minimum weekly payment is now around $714 a week — an increase of more than 17,000%.

States differ in how long they will pay benefits. Most offer up to 26 weeks, or 6½ months, of payments.

Some states have a much shorter duration. Florida and North Carolina, for example, offer up to 12 weeks — the least of any state, according to the Center on Budget and Policy Priorities.

The coronavirus relief bill offers an additional 13 weeks of benefits, up to a maximum of 39 weeks (about 10 months).

Prior to the economic crisis caused by COVID-19, the average worker collected unemployment benefits for about 15 weeks, according to Labor Department data.

Just because you’re unemployed or lost your job doesn’t mean you’ll collect benefits.

There’s a big gap between states when measuring the share of jobless people who are receiving unemployment benefits.

North Carolina’s “recipiency rate” is the nation’s lowest — just 10.5% of unemployed workers collect unemployment insurance. In New Jersey, it’s nearly 52% — the nation’s highest share.

There are several factors at play here.

Not all unemployed workers are eligible to collect benefits, for example. Some, like the self-employed and independent contractors, couldn’t generally collect prior to the relief law’s expansion of eligibility criteria. Others may have been fired for cause rather than laid off. 

But some states with small shares may make it more challenging relative to other states to apply for and receive benefits, thereby dragging down their recipiency rates, labor economists said.

Unemployed workers may also be dissuaded from applying for benefits if they think their weekly benefit checks will be small and last for a relatively short time, which would also reduce the percentage.  

You might think that benefit payments are a function of the cost of living in a given state.

That’s partly true. But not entirely.

States pay jobless benefits based on a worker’s prior wages, typically over the last four quarters. Wages somewhat reflect cost of living.

But rules adopted by state officials, such as benefit formulas and how well they fund unemployment programs, also play a big role, said Christopher O’Leary, senior economist at the W.E. Upjohn Institute for Employment Research.

For example, while Arkansas indexes its maximum weekly benefit to two-thirds the average weekly wage, Connecticut’s formula is different — it indexes at 50%, O’Leary said. But not all states index that way — some state officials just pick a dollar amount that isn’t pegged to wages, O’Leary said.

And states can override their benefit formulas due to reasons of inadequate financing, he said.

“You can’t say those [weekly benefit] averages are based on cost of living,” he said.

It seems some states are just more generous than others.