Unemployment compensation programs are called automatic stabilizers because payments increase during

Question

Quizplus · Accepted Answer

Unemployment compensation programs are designed to provide financial assistance to individuals who lose their jobs. During recessions, the number of job losses typically increases, which leads to a higher demand for unemployment benefits. The automatic feature of these programs increases payments during economic downturns, which helps to stabilize the economy by providing an income floor for workers who have lost their jobs.

Unemployment Compensation Programs Are Called Automatic Stabilizers Because Payments Increase