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Home » Unemployment-insurance program now 75 years old

Unemployment-insurance program now 75 years old

In all, state has paid out $28 billion in benefits to 11 million-plus workers

September 9, 2010

The state of Washington has paid out $28 billion in unemployment benefits to more than 11 million workers since the unemployment-insurance system was created 75 years ago.

On Aug. 14, 1935, President Franklin D. Roosevelt signed into law the Social Security Act, which also created the unemployment-insurance program. The purpose of unemployment insurance, said FDR, was to "give some measure of protection to the average citizen and his family against the loss of a job" and to "lessen the impact of future depressions."

The program continues to strive hard to accomplish those lofty goals, says Employment Security Commissioner Karen Lee.

"For 75 years, unemployment insurance has helped Americans weather the cyclical nature of our economy," Lee says. "From the Great Depression to the Great Recession and all of the economic downturns in between, unemployment benefits have been a lifeline for jobless workers and their families."

Washington was one of five states—the others were New York, California, Massachusetts, and Utah—to pass legislation in 1935 in anticipation of the Social Security Act. But it wasn't until 1938 that Washington began collecting unemployment-insurance taxes from employers.

Just over $6 million in benefits was paid to jobless workers in Washington in 1939, the first year benefits were paid to claimants. That also was the year the Washington state Employment Security Department, as it exists today, was created.

The average weekly benefit check was less than $12, and the maximum benefit check was about $15.

Last year, more than 470,000 people collected $4 billion in benefits in Washington state, compared with nearly 78,000 claimants in 1940. Claimant numbers for 1939 aren't available.

The average check is now about $380, and the maximum for 2010 claims is $570. Each dollar of unemployment benefits currently generates an estimated $1.62 in additional economic activity, the state agency says.

Nearly 250,000 Washington workers were covered by the insurance program in its first year, compared with nearly 2.8 million today.

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