government guarantees work at a living wage. Temporary measures can include public works programs such as the Works Progress Administration. Government-funded employment is not widely advocated as a solution to unemployment except in times of crisis. That is attributed to the public sector jobs' existence depending directly on the tax receipts from private sector employment. In the US, the unemployment insurance allowance is based solely on previous income (not time worked, family size, etc.) and usually compensates for one third of previous income. To qualify, people must reside in their respective state for at least a year and work. The system was established by the Social Security Act of 1935. Although 90% of citizens are covered by unemployment insurance, less than 40% apply for and receive benefits. However, the number applying for and receiving benefits increases during recessions. For highly-seasonal industries, the system provides income to workers during the off-season, thus encouraging them to stay attached to the industry. According to classical economic theory, markets reach equilibrium where supply equals demand; everyone who wants to sell at the market price can do so. Those who do not want to sell at that price do not; in the labour market, this is classical unemployment. Monetary policy and fiscal policy can both be used to increase short-term growth in the economy, increasing the demand for labour and decreasing unemployment. Supply-side solutions However, the labor market is not 100% efficient although it may be more efficient than the bureaucracy. Some argue that minimum wages and union activity keep wages from falling, which means that too many people want to sell their labour at the going price but cannot. That assumes perfect competition exists in the labour market, specifically that no single entity is large enough to affect wage levels and that employees are similar in ability. Advocates of supply-side policies believe those policies can solve the problem by making the labour market more flexible. These include removing the minimum wage and reducing the power of unions. Supply-siders argue that their reforms increase long-term growth by reducing labour costs. The increased supply of goods and services requires more workers, increasing employment. It is argued that supply-side policies, which include cutting taxes on businesses and reducing regulation, create jobs, reduce unemployment, and decrease labor's share of national income. Other supply-side policies include education to make workers more attractive to employers. History There are relatively limited