Unemployment Compensation

The U.S. unemployment compensation program and the employment service programs form a federal-state cooperative system. The Federal Unemployment Tax Act levied a tax on the payroll of employers. State financing and benefit laws vary widely. In general, unemployment benefits are intended to replace about half of an average worker's wages, up to a maximum. All states pay benefits to some unemployed people for 26 weeks. During periods of heavy unemployment, federal law authorizes extended benefits, which are financed in part by federal employer taxes. See Also Unemployment Insurance.