IV.

Unemployment Insurance in Other Countries

Nineteen European nations had compulsory unemployment insurance programs before the U.S. program was established. The first was instituted in Britain in 1911, and it expanded rapidly to cover most low-wage, nonfarm workers. By the late 1920s potential duration of benefits was unlimited, and requirements for eligibility had been relaxed so that some workers could draw two weeks of benefits for each week they had been employed. The British have also altered their system over time and have introduced a redundancy payment, a one-time benefit paid at the time of layoff.

Most nations have some form of compulsory unemployment insurance. These programs differ from that in the U.S. in important ways. Potential duration is longer in many developed countries and shorter in most developing nations. Benefits generally are financed at least partly by income taxes rather than by taxes on employers alone. Where taxes on employers are used, they are not related to past records of layoffs.