Most unemployed don't get benefits: Here's why

WASHINGTON - Even though the U.S. job market is gaining strength, there are still a lot of unemployed Americans. Yet only a fraction of them are receiving financial aid from the government.

Fewer than 25 percent of those out of work are signed up for weekly unemployment benefits, a near-record low since the government began tracking this data in 1987. That's a sharp turnaround from just after the recession, when as many as three-quarters of those out of work received help, a record high.

The drop counters a common assumption that most of those out of work receive unemployment benefits. It is partly a sign of an improving job market: Layoffs have plummeted and Americans seem more confident in their prospects for finding a job. But the drop also reflects the fact that state and federal benefit programs have been downsized from where they were just a few years ago. Unemployment benefits had been extended nationwide for as long as 99 weeks in 2009.

"We cut back on the safety net really sharply when the labor market is still damaged," said Josh Bivens, director of research at the Economic Policy Institute, a liberal think tank.

In October, an average of 2.1 million people received benefits each week, according to calculations by the EPI. That is equal to just 23.3 percent of the nearly 9 million who were out of work, and is just above September's 23.2 percent, the all-time low.

Here are five things to know about the drop-off in benefits:

HARDLY ANYONE IS GETTING LAID OFF. If you survived the tsunami of job losses in the Great Recession, you now have pretty good job security. Average monthly layoffs this year and last are running at the lowest levels since the government began tracking the data in 2001. That's helped bring down the unemployment rate to 5.8 percent, a six-year low.

THOSE WHO LOSE JOBS ARE MORE CONFIDENT. People are less likely to apply for benefits after a layoff when the job market improves. They may find jobs more quickly, or feel more confident that they will.

SMALLER SAFETY NET. A big reason fewer people are receiving benefits is a less happy one: It's because fewer benefits are available. Both the federal government and many state governments have sharply cut back on their assistance to the unemployed. The federal extended benefits program expired at the beginning of this year. That immediately cut off benefits for about 1.2 million people.

MOST DON'T QUALIFY. Unemployment benefits are only available to those who lost a job through no fault of their own. Because laid-off workers make up fewer of the unemployed, the proportion receiving benefits is smaller.

MORE HIRING IS NEEDED. Even if layoffs are low, the job market still isn't back to full health. If you are out of work, your chances of getting a job are better but could use more of a boost. Just over 24 percent of those who were unemployed in September found jobs in October, according to Labor Department data.

That was the highest monthly figure since the downturn, though still below the average of 28 percent in the decade preceding the downturn.