Labor Economics 5th Edition by George Borjas

Exercise 10

Unemployment Insurance automatically stimulates the economy during an economic contraction, which is good from the workers' point of view. From the firm's point of view, however, the UI system can be overbearing on business during prolonged contractions.
(a) What is it about the UI system that generates these opposing views
(b) How could the UI system be changed to also assist firms during economic contractions while not removing the benefits available to laid-off workers