Why does Illinois' Unemployment Insurance Trust Fund have a large deficit?

13 Pages Posted: 24 Aug 2022

See all articles by David Merriman

David Merriman

University of Illinois at Chicago - Institute of Government and Public Affairs; Department of Public Administration

XIAOYAN HU

affiliation not provided to SSRN

Alea Wilbur-Mujtaba

University of Illinois at Chicago - Institute of Government and Public Affairs

Date Written: August 18, 2022

Abstract

The economic disruption brought about by Covid and stay-at-home orders led to an unprecedented rise in unemployment and extreme fiscal stress on states’ unemployment insurance (UI) trust funds. Although this happened in nearly all U.S. states, Illinois is one of only a few states that emerged with a very large—more than $4 billion—net deficit in the fund. Through this analysis, we seek to understand Illinois’ experience and draw lessons about policy going forward. We begin by providing some background about the UI system and its financing.

Keywords: unemployment, fund, state, Illinois, balance, federal, insurance, wage

Suggested Citation

Merriman, David and HU, XIAOYAN and Wilbur-Mujtaba, Alea, Why does Illinois' Unemployment Insurance Trust Fund have a large deficit? (August 18, 2022). Institute of Government and Public Affairs Research Paper No. Forthcoming, Available at SSRN: https://ssrn.com/abstract=4198350 or http://dx.doi.org/10.2139/ssrn.4198350

David Merriman (Contact Author)

University of Illinois at Chicago - Institute of Government and Public Affairs

Chicago, IL 60607
United States

Department of Public Administration ( email )

400 S Peoria St.
2122 AEH (MC278)
Chicago, IL 60607
United States

XIAOYAN HU

affiliation not provided to SSRN

Alea Wilbur-Mujtaba

University of Illinois at Chicago - Institute of Government and Public Affairs ( email )

1200 W Harrison St
Chicago, IL 60607
United States

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