Anthropic CEO Dario Amodei and Microsoft AI chief Mustafa Suleyman have predicted that most white-collar jobs could be automated within the next one to five years, and JPMorgan Chase CEO Jamie Dimon said last month that now is the time to start thinking about large-scale AI labor disruption. A recent analysis from Morgan Stanley offered a more tempered outlook for workers: Your current job may be eliminated, but you won’t be unemployed forever as new jobs replace old ones. 

Regardless of which predictions are correct in the long term, AI layoffs are here, and they bring with them looming economic uncertainty for newly unemployed workers in a stagnating job market. 

Many could turn to unemployment insurance benefits designed to tide workers over while they find new work, and Amodei has repeatedly called on the government to prepare for high unemployment. 

But in 2022, nearly 75% of unemployed people didn’t even apply, according to the Bureau of Labor Statistics (BLS). Experts who spoke to Fortune say that number is still accurate today. 

Over the past year, new unemployment insurance claims have held at a relatively stable range of 200,000 and 250,000 claims per week, even as the unemployment rate has risen to 4.4% last month from 4.2% a year earlier, signaling that many workers are not taking advantage of a key safety-net measure. 

Why people don’t apply

According to a 2023 BLS survey of 2022 unemployment filings, 55% of people didn’t apply because they didn’t believe they were eligible for benefits. 

Potential eligibility issues included their work not being covered by unemployment insurance, voluntary departures from their job, termination for misconduct, insufficient past work, and previously exhausting benefits.

Meanwhile, another 17% didn’t apply because they expected to get a new job soon, and 10% said they didn’t need the money, had a negative attitude about unemployment benefits, didn’t know about them, or had problems applying.

Applicants also face a high rejection rate. Only about 55% of people who apply for benefits receive them, according to the BLS. 

Understanding the unemployment insurance system can be daunting because it’s not one national system. Each state and territory has its own rules and qualifications. 

Factors such as why you left your job, how much you earned in recent quarters, and your willingness to accept new work affect eligibility. As such, recent graduates and people returning to work after parental or family leave are less likely to be eligible because they don’t meet the earnings qualifications. 

There are still some common misconceptions about eligibility, said Alexander Hertel-Fernandez, a professor of government at Columbia University who served in the Department of Labor and the White House during the Biden administration. Many people think quitting automatically makes one ineligible, but it depends on why a worker left. Harassment or workplace law violations are legitimate reasons to quit and may not affect eligibility, and the rules are different in each state. 

It’s hard to know who doesn’t apply for unemployment insurance because they don’t show up in the data, Hertel-Fernandez told Fortune. From his coauthored research with the National Employment Law Center, he found that workers with more formal education and higher earnings are much more likely to apply for unemployment insurance. White workers are more likely to apply and receive benefits than workers of color, who are less likely to think they are eligible, he said. 

Even after you apply, the process to get benefits can be prolonged. 

“Often, applying for unemployment means going through a legal process. Your employer may try and fight your application process,” Hertel-Fernandez said, adding that a quarter of applicants say their employers tried to contest their application. “Employers have a reason to do this because their taxes go up in most states if you claim unemployment benefits. There’s a direct link between the two.”

He pointed to the decline of labor unions as one reason why so many people don’t apply for benefits in the first place. Labor union membership fell to a historic low of 9.9% in 2024 and made little gains in 2025, according to the BLS. 

“One of the best predictors of whether or not you apply for benefits and you receive them is if you belong to a union, because the union helps you understand the process and can even help you with the application,” he said. People who belonged to unions in their previous jobs are twice as likely to apply for benefits, according to the BLS. 

Preparing the system for more layoffs

The framework for unemployment insurance has not been updated since it was created as part of the New Deal, and the federal taxes that support the program have not changed since the 1980s. 

“We test [the system] every time, every time there’s a recession or some type of economic downturn, like when it was related to COVID,” Rachael Kohl, an assistant professor at the Wayne State University Law School, told Fortune. She previously directed the Workers’ Rights Clinic at the University of Michigan Law School, where she primarily handled unemployment insurance cases. 

During the pandemic, UI benefits provided support to one in six U.S. adults and kept at least 4.7 million people out of poverty, according to the BLS and the U.S. Census Bureau. Still, many states’ systems were beleaguered with payout delays that continue today. 

Over time, benefits have shrunk as well. Historically, jobless workers were eligible for 26 weeks of insurance, but some states, like Arkansas, Florida, and North Carolina, have cut that down to just 12 weeks. The original goal of unemployment insurance was to replace 50% of previous wages, but in many states it’s closer to 30% or less, Hertel-Fernandez said. 

“Really, a wholesale reform is needed, especially as we think about the impact of AI on potential labor market disruptions, and especially as we might think of another recession coming down the pike as well,” he said, adding that the current system is not prepared for widespread, long-term unemployment. He suggested making the application process easier and increasing eligibility for people who have limited experience in the labor market. 

“While that may be appropriate for you to find another job in normal times, if we’re predicting that some jobs may be disappearing, it’s going to be a lot harder to use that time to retrain and support, say, shifting to a whole other industry or occupation.”