Unemployment Insurance

Unemployment insurance is a means of protecting workers who are out of work and looking for employment. These unemployed workers receive cash payments, usually each week for a limited period. Besides aiding individual workers, unemployment insurance may help limit slumps in business activity by enabling unemployed people to buy goods and services. Such purchases help preserve existing jobs. Most industrial nations have government-sponsored unemployment insurance systems.

The first known unemployment insurance plan was adopted in Baisle Town (now Basel), Switzerland, in 1789. In 1911, Britain set up an unemployment insurance system that required the participation of workers and employers.

In 1932, Wisconsin adopted the first unemployment insurance law in the United States. A federal-state unemployment insurance plan was established by the Social Security Act of 1935. By 1937, all the states had unemployment insurance laws that met the requirements of the Social Security Act. Canada adopted an unemployment insurance program in 1940.