California Policy Lab

The COVID-19 pandemic had an immense impact on the labor market in California and the U.S., with unemployment reaching highs not seen since the Great Depression. The regular Unemployment Insurance (UI) system, as well as federal legislation that created supplemental UI programs and benefit extensions, played a fundamental role in the country’s economic and public health response. Individual-level data on who applied for and received UI benefits can provide crucial insights into understanding how the crisis evolved, how well the government’s response worked, and what the implications are for future crises. The pandemic also brought to the forefront more fundamental issues with our nation’s UI system, such as pervasive inequities in which workers actually receive benefits and large differences in benefit amounts and durations. While some of these issues have persisted for decades, a lack of access to individual-level UI data has prevented a deeper understanding of the extent of the inequities. The crisis also revealed that even the most fundamental statistics that policymakers rely on have important flaws, and basic information on which workers benefit from some of the core UI programs is completely missing, despite the data being collected every day by UI agencies as they pay benefits. The California Policy Lab (CPL) partnered with the California Employment Development Department (EDD), which manages unemployment insurance in California, to help bring greater clarity to policymakers about the impact of the crisis in California. CPL’s first analysis was published in April 2020, and through this unique relationship, CPL was able to use anonymized claims data to track the labor market crisis in close to real-time and to provide in-depth, detailed insights on the federal government’s response. Through a series of 19 reports, CPL generated new findings about a range of issues in the California UI system. CPL’s research also shed light on which demographic groups and types of workers benefited the most from the different program extensions during the pandemic and which workers fell through the cracks and were unable to access vital UI benefits. By working directly with complicated claims data for more than two years, CPL developed new, more accurate and timely measures of how many people were relying on the UI system as compared to the measures that policymakers and the media typically have relied on. This work directly demonstrated for state and federal policymakers how the measures they had historically relied on provided a distorted view of the labor market during the crisis. For example, a 2020 GAO report cited CPL’s research, finding that published claims data were likely inflated (Government Accountability Office, 2020). This report highlights ten key insights about the UI system and the labor market that are based on CPL’s unique partnership with EDD and the unique data access this partnership provided. The report focuses on six insights on equity and disparities in access to unemployment insurance benefits during the pandemic. It then documents four insights on measurement issues in the publicly available data and how access to California’s administrative records allows CPL to overcome these issues. We also share how these improved measurements can inform policy choices to improve equity. 

This work has been supported, in part, by the University of California Multicampus Research Programs and Initiatives grants MRP-19-600774 and M21PR3278