Virginians are among least likely to seek unemployment insurance. It might be because benefits are so low.
Tammy Bragg works the grill at the Texas Inn in Lynchburg. (Ned Oliver/Virginia Mercury)
Unemployment benefits are intended to provide a temporary safety net for people who lose their jobs, but for decades, fewer and fewer people in Virginia have been turning to the program for help.
A report released last week notes that Virginia’s recipiency rate, a metric used by the federal government to track uptake of benefits, has dropped to the third lowest in the country at just 16 percent.
That might be because the benefits the program offers are so low they don’t cover basic food, housing and transportation costs, the review, conducted by the Joint Legislative Audit and Review Commission, suggested.
The state’s maximum weekly benefit is capped at $378 and can be as low as $60, depending on how much money a person was earning before they lost their jobs.
The upper limit was last increased in 2008 and the lower limit was last increased in 2014, when lawmakers increased it from $54.
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“Virginia does not regularly increase UI benefit amounts, which is a primary reason its UI benefits are lower than other states,” the report states.
The legislative analysts suggested that if the General Assembly wanted to do something about that, they could follow lead of the 35 states that have indexed their benefits to economic metrics.
They calculated that indexing maximum benefits to 50 percent of average weekly wages — the level of support the program has historically aimed to provide — the maximum weekly benefit would rise from $378 to $682 and keep rising each year as wages change.
For a more gradual increase, they suggested the state could tie benefits to the annual percentage increase in average weekly wages, which sits at about 3 percent.
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