Stats show they also cushion against consumption declines.

Katsuhiro, 2020, “Wage Subsidies for Reemployment and Unemployment Insurance,” The Conference Exchange, https://nta.confex.com/nta/2020/mediafile/ExtendedAbstract/Paper4013/Komatsu_UI_reemployment.pdf

This paper studies the welfare implications of providing temporary wage subsidies to people finding a job after unemployment. Following earlier studies on UI, I construct a dynamic model of consumption, saving, and job search, and derive a formula for the welfare impact of wage subsidies that can be evaluated with several reduced form parameters. Using parameter values common in the literature, I find that providing wage subsidies for reemployment brings about a large welfare impact by reducing the cost of UI. Specifically, the policy outperforms many historical policy changes targeting adults considered in Hendren and Sprung-Keyser (2020) in terms of cost effectiveness. I also calibrate parameters in the model and show that (i) given the current UI generosity, the optimal level of wage subsidies is the same as the level of UI benefits, and (ii) providing wage subsidies makes the optimal UI more generous, which means that wage subsidies enable the government to provide more generous protection against consumption declines during unemployment as an optimal policy than currently provided.