$2.2 Billion Lost To Unemployment Fraud

It is estimated that about $2.2 billion of unemployment benefits in the year of 2011 went to people who were actually employed. Unemployment benefits were made for those who need support after they have just been laid off, but for many, unemployment benefits have just become an extra source of income. A total of $108 billion was used towards unemployment benefits in 2011, and although $2.2 billion may only be a small percentage of $108 billion it is still a lot of money.

Since there is such a large amount of money being allocated towards people who are employed, people can expect that the amount of people employed is actually higher than what we know it as due to the fact that there are many jobs that pay under the books. But although the work force may be larger, this says little about the unemployment rate due to the fact that many people who aren’t looking for jobs are not factored into the unemployment rate. In order to decrease the amount of money spent on those who do no deserve unemployment benefits, the government should impose stricter regulations on such benefits.

Written by: Jessica Ho
Source: The Wall Street Journal

http://blogs.wsj.com/economics/2013/04/27/number-of-the-week-fraud-in-unemployment-benefits/?mod=WSJBlog&mod=marketbeat

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