Insufficient Unemployment Benefits
State unemployment benefits in Southern states are insufficient to cover basic household expenses, except in Kentucky. Moreover, 5 Southern states cut off benefits sooner than the national average.
Counties where state unemployment insurance fails to cover basic costs
Includes costs for a two-bedroom home, food, and transportation
In September, 7.7 million people remained unemployed nationwide. That’s 2 million more than in February 2020.1 In every Southern state except Kentucky, monthly state unemployment benefits are insufficient to cover basic household expenses. In addition, Southern states tend to offer state unemployment benefits for fewer weeks than other states. While most states nationwide offer unemployment benefits for 26 weeks, 9 states offer benefits for fewer than 26 weeks. Of these, 5 are in the South: Arkansas, Alabama, Florida, South Carolina, and North Carolina.2 Moreover, unemployment benefits have not reached all eligible individuals — likely because states did not have the technological and administrative capacity to process a huge increase in claims when the pandemic struck.3,4
Not surprisingly, Southerners were more likely to struggle to put food on the table in September, with 11% of adults reporting their household sometimes or often went hungry compared to 8.9% of non-Southern adults (Food Insecurity). Southerners were also more likely to fear impending eviction or foreclosure (Likelihood of Eviction or Foreclosure).
As long as affordable child care options remain unavailable, employers will struggle to attract sufficient workers. In Louisiana, where the unemployment rate was the highest of all Southern states in August (6.2%), the maximum unemployment benefit is $247/wk (equivalent to $6.88/hour) and the minimum wage is only $7.25/hour.5 Though unemployment benefits are low, employers will be hard-pressed to attract workers at wages less than $15/hour, with babysitters averaging $13.10/hour.6
“The Employment Situation — September 2021”. U.S. Bureau of Labor Statistics. October, 2021. https://www.bls.gov/news.release/pdf/empsit.pdf
“Policy Basics: How Many Weeks of Unemployment Compensation Are Available”. Center on Budget and Policy Priorities. October, 2021. https://www.cbpp.org/research/economy/how-many-weeks-of-unemployment-compensation-are-available
“Unemployment filing failures”. Zipperer, Gould. Economic Policy Institute. April, 2020. https://www.epi.org/blog/unemployment-filing-failures-new-survey-confirms-that-millions-of-jobless-were-unable-to-file-an-unemployment-insurance-claim/
“Building States’ Labor Infrastructure”. Bustamante. Southern Economic Advancement Project. March, 2021. https://theseap.org/wp-content/uploads/Building-States-Labor-Infrastructure.docx.pdf
“Unemployment Rates for States”. U.S. Bureau of Labor Statistics. September, 2021. https://www.bls.gov/web/laus/laumstrk.htm
“How much does a babysitter cost in New Orleans, LA?” Nanny Lane. https://www.nannylane.com/cost/babysitters/la/new-orleans