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New Research Shows Workers with Lowest Income Suffer Longest Wait Times Unemployment Insurance

HR Tech Outlook | Monday, March 01, 2021

The data reflects the increasing disconnect between the unemployment insurance system and the rise of the 1099 economy workforce, which has grown 15 percent since 2010 and now accounts for over one-third of the US workforce, as per the Bureau of Labor Statistics.

Fremont, CA: Steady, an app used by more than 2.5 million gig and hourly wage earners, has published results from a nationwide survey that indicate that lower-income gig employees face longer delays than their more wealthy counterparts in obtaining unemployment insurance.

The data reflects the increasing disconnect between the unemployment insurance system and the rise of the 1099 economy workforce, which has grown 15 percent since 2010 and now accounts for over one-third of the US workforce, as per the Bureau of Labor Statistics. Unlike full-time employees, which have fewer income sources, 1099 or hourly wage earners sometimes struggle to compile and offer paperwork from multiple income sources, including gig apps like Lyft or Instacart.

"1099 workers often face an insurmountable clerical task of providing documentation of income from multiple streams, and then wait in the balance as the government attempts to verify it, " stated Adam Roseman, founder and CEO of Steady. "The data tells us that Americans who need emergency relief the most often face the greatest delays in getting access to benefits."

Because workers grant Steady access to their actual bank transactions, the app can generate a real-time understanding of earnings. Workers also utilize the app to generate "income intelligence" to inform job searches and financial decisions. As per an analysis published this year, workers who utilize the app see average gains of $5,500.

Other findings from Steady's analysis include:

• There has been over a 23 percent drop in gig or hourly workers earning income since six months ago.

• The industries hit hardest by the pandemic that saw the biggest declines in gig worker income include hospitality, entertainment, and rideshare; those that saw a huge increase in gig worker income were the three categories of delivery: grocery, other and restaurant.

"Steady's data highlights the harsh reality that our unemployment insurance system is ill-equipped to serve workers hardest hit by the pandemic," stated Andy Stettner, fellow of the Century Foundation. "The requirement that unemployment insurance applicants send in their tax records or other verification may help to prevent rampant fraud, but in doing so, it blocks access to the benefits that American families urgently need."

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