America’s safety net only aids 3 out of 10 unemployed workers without a permanent fix, study finds

• The Center on Budget and Policy Priorities said the unemployment insurance system needs urgent reform.
• It cited disproportionate benefits to white workers and only 3 in 10 eligible workers receiving benefits.
• Biden included UI reform in his infrastructure plan, but its details weren't "fully baked," an expert said.
• See more stories on Insider's business page.

To help Americans struggling during the pandemic, President Joe Biden extended weekly $300 unemployment benefits through September 6 in the stimulus package he signed into law in February.

But the left-leaning Center on Budget and Policy Priorities (CBPP) found in a report released Wednesday that the overall unemployment insurance (UI) system needs a permanent revamp better suited to today's economy.

Nationwide, fewer than three in 10 unemployed workers receive UI while less than half of the average worker's lost earnings get replaced by UI, the report found. In several states, it added, fewer than the standard 26 weeks of regular benefits are available to UI recipients. The center said the temporary UI expansions from Biden's stimulus "don't address the long-standing problems in the underlying system."

"No matter the state of the national economy, losing a job is devastating for low-paid workers with few assets, many of whom get little or no UI," the report said. "And losing a job is common during normal economic times, both as businesses downsize periodically due to changes in demand and because workers can lose their jobs if they aren't able to work for a period of time for various reasons, like attending to a family health situation."

Here are three reasons why Congress needs to fix the UI system, according to CBPP:

1. States could cut back on UI benefits to continue their obligation of paying benefits during a recession;
2. The current system keeps many low-income workers, women, and workers of color from receiving benefits given that those workers experience higher levels of unemployment in both good and bad labor markets;
3. And pandemic measures, like extending unemployment benefits through September 6, have helped millions of people but are only temporary.

The report added that a plan from Sens. Ron Wyden of Oregon and Michael Bennet of Colorado would help with long-term UI reform, which Insider reported on April 14 would mandate states to replace up to 75% of a person's income at their last job. It would also require states to provide a minimum 26 weeks of unemployment benefits, with an additional 13 weeks triggered if the unemployment rate climbs above 6.5% at the national or state level, tying the flow of aid to economic conditions.

"Unemployment programs are critical to helping workers stay afloat during difficult times - but too many workers still struggle to access their benefits in our patchwork of outdated state systems," Wyden said in a statement at the time.

On April 23, 38 Democratic lawmakers sent a letter to Biden urging him to permanently reform the UI system within his infrastructure package.

A White House briefing document on Biden's infrastructure plan said the president is pledging to reform the system, but as Insider reported, the details of how he would do so are vague and no funds are currently allocated for it.

Andrew Stettner, an unemployment expert at the Century Foundation, previously told Insider that "it's a good start," but it's "certainly not fully baked and there needs to be additional baking for what would get into the final basket of items."