To qualify for unemployment insurance benefits, a person must:
• have lost a job through no fault of his or her own;
• be “able to work, available to work, and actively seeking work;” and
• have earned at least a certain amount of money during a “base period” prior to becoming unemployed. 

States vary considerably in how they apply these general criteria.  For example, some states do not cover part-time workers unless they are willing to take a full-time job, while other states allow these workers to qualify even if they are seeking another part-time job.  Also, states have some choice about the base period of employment used to determine eligibility.

For the past 25 years, fewer than half of unemployed workers have actually received unemployment insurance, except during recessions. To be sure, unemployment insurance is not designed to cover all unemployed workers; it does not cover people who leave a job voluntarily, people looking for their first job, and re-entrants who previously left the labor force voluntarily.   But, the growing percentage of unemployed workers who meet the basic criteria described above yet fail to satisfy their state’s eligibility criteria established decades ago (in a very different labor market) — has made it harder for UI to fulfill its mission.

In 1994, President Clinton and congressional leaders appointed a bipartisan Advisory Council on Unemployment Compensation to address these problems.  The commission identified a number of serious problems with UI eligibility and other rules and recommended a series of reforms.  While some states instituted some of the reforms, the federal government made no comprehensive effort to consider the recommendations until very recently.  The 2009 Recovery Act made $7 billion available through 2011 to states that modernized their unemployment insurance law to expand eligibility; 38 states plus Washington, D.C., Puerto Rico, and the U.S. Virgin Islands received federal funds under this provision.