It’s workers who are actually paying down NC’s unemployment insurance debt
11/17/2014 by Alexandra Forter Sirota
NC Policy Watch
North Carolina’s unemployment insurance debt is being paid down, but a little recognized fact is that it is workers who have contributed the most towards its repayment — not employers. The debt itself was a result of the historic job loss of the Great Recession and the tax cuts that were provided to employers during good times that left the Unemployment Insurance Trust Fund underfunded when it was needed the most. Borrowing from the federal government was the only way in which the state could meet its commitment to provide workers who had lost their jobs through no fault of their own with a temporary and partial replacement of their wages until the economy recovered.
The good news is that unemployment insurance payments not only mitigated even worse fallout from the Great Recession for workers and their families, they likely stopped a further decline in consumer spending and the resulting spiral of job loss that would have hit businesses harder and made the economic recovery even longer for everyone. Unfortunately, North Carolina policymakers took these economic conditions and the debt as a reason to enact some of the country’s harshest cuts to unemployment insurance, many of which are unlike what any other state does in designing their unemployment insurance systems. read article
North Carolina dreaming
7/8/2014 by Dr. Dean Baker NC Policy Watch
Conservative pundit swings and misses in his defense of unemployment insurance cuts
Last year North Carolina’s conservative Republican legislature got tough. It sharply reduced the duration of unemployment benefits and made them much more difficult to collect... Their story was that unemployment insurance and other benefits discourage workers from seriously looking for jobs... We now have data for 10 months into the experiment (through May) and John Hood, the chairman and president of the John Locke Foundation, a North Carolina think tank, has a piece in the Wall Street Journal telling us that it is a resounding success. Hood tells readers:
“According to the U.S. Bureau of Labor Statistics, the number of payroll jobs in North Carolina rose by 1.5% in the second half of 2013, compared with a 0.8% rise for the nation as a whole. Total unemployment in the state dropped by 17%, compared with the national average drop of 12%."
...As far as the great news on unemployment that Hood cites, this is entirely a story of North Carolina workers giving up looking for work and leaving the labor market... In short, if we look at the data instead of playing games with it, the story is pretty clear. There is zero evidence that cutting unemployment benefits in North Carolina or the rest of the country did anything to spur job growth. There is much evidence that it led those who saw their benefits to end to give up looking for work and to drop out of the labor force. read article
The Senate Is Nearing A Deal On Unemployment Insurance And It Shows The Absurdity Of The Republican Position
by DANNY VINIK JAN. 30, 2014
When Senate Republicans filibustered the extension of emergency unemployment benefits on January 14, there didn't seem to be much hope that the sides to come to an agreement. Two weeks later though,
multiple reports suggest that the sides are nearing a deal on a three-month extension that reveals the absurdity of the Republican negotiating position...
Republicans rejected the Democrats' original proposal of future Medicare provider cuts on the grounds that they were uncertain to materialize. But now, they are close to accepting a "pension funding" gimmick in which the savings are certain not to materialize... Effectively, Republicans are tricking their supporters into believing that the bill has a spending offset... It's great politics.
On policy, Republicans are getting nothing. They are extending unemployment benefits for imaginary cuts. Over the long-term, this deal would add to the deficit. That's great for Senate Democrats. It's exactly what they wanted on policy grounds. Whether Senate Republicans ultimately go for it remains to be seen. Yesterday, Sen. Rob Portman (R-Ohio) said that the "reality is, we’re pretty close." Then, it would have to pass the House, an even tougher task. But for now, there is hope. It just goes to show the absurdity of the Republican position that they rejected a deal with a real, if far-off, spending offset in return for one that is certain to increase the deficit. But if that's what it takes to get a deal done, then I'm all for it. read article
Politics at play under the surface of unemployment benefits debate
By Halimah Abdullah and Tom Watkins January 7, 2014 CNN
...Democrats say they're trying to help Americans struggling to pay their bills until they get back on their feet and that failing to pass an extension will tank the economic recovery. Republicans say they, too, want to help, but want to offset the $26 billion price tag with cuts elsewhere. They also argue such extensions are a disincentive to looking for work. Caught in between are those who lost their benefits because of Congress' failure to act late last year.
Why have unemployment benefits become a battle?
On Tuesday, a Democratic bill that would provide a three-month extension cleared its first hurdle in the Senate with the help of a handful of Republicans... The 60 yea votes were the minimum needed to allow debate to go forward and avoid a filibuster in the Senate. read article/watch video
N.C.’s unemployment rate goes up to 6.8 percent, labor pool shrinks
Sarah Ovaska September 19, 2014
North Carolina’s unemployment rate shot up in August, as the state’s labor force continues to shrink. The state had 6.8 percent of its labor force actively looking for jobs in August, an increase from 6.5 percent the prior month, according to the monthly jobs report released by the N.C. Department of Commerce’s Labor and Economic Analysis Division...
The jobs report (click here to read) also show that the number of employed workers dropped by 28,666 from the prior month to 4.34 million while the state’s overall labor force (which consists of those in jobs and those looking for jobs) dropped by nearly 20,000 to 4,66 million in a month’s time. Unemployed workers increased by more than 10,000 from July to August, but the 314,962 people looking for work in August. That’s down from a year earlier, when 372,467 North Carolinians were out of work. read article
Missing Workers Update: June 2014
Alexandra Sirota Wednesday, July 23, 2014
With the release last month of the latest labor market figures, the Budget & Tax Center has updated as well its estimate of the number of missing workers in North Carolina’s labor market. This measure estimates the number of workers who would be in the labor market, looking for work, if job opportunities were stronger. In June 2014, the number of missing workers remained elevated at 241,445. If these workers were counted in the unemployment rate, that rate would be 11.5 percent rather than the official 6.4 percent for that month. read more
Also read: Is this the most destructive act of NC's current state leadership?
Editorial: Extend US benefits to help NC jobless
April 9, 2014
... the U.S. Senate has passed a measure that would extend federal benefits to about 2.8 million people nationwide, including North Carolinians if McCrory will go along with it. He’s not even taking a position, and his office says he won’t until the U.S. House passes the measure. U.S. Sen. Kay Hagan, a Democrat, supported and advocated for the bill. Republican Sen. Richard Burr voted against it.
The Republicans’ logic in cutting benefits in North Carolina was just plain mean... It was no wonder that between cuts to unemployment and a refusal to extend Medicaid to hundreds of thousands of North Carolinians, many observers saw a “war on the poor” being staged in the General Assembly... McCrory has a chance to redeem himself and the party. But first, let’s hope the unemployment bill passes the House. The jobless need it, and the country needs it because it will stimulate the overall economy. This is important for everyone. read article
Senate votes to extend jobless benefits for long-term unemployed
BY DAVID ESPO, ASSOCIATED PRESS PBS Apr 7, 2014
...Capping a three-month struggle, the approval sends the legislation to a hostile reception in the House, where majority Republicans generally oppose it... The measure would retroactively restore benefits that were cut off in late December, and maintain them through the end of May...
Underscoring the political backdrop, a little-noticed provision in the jobless-benefits legislation is specifically designed to benefit the long-term unemployed in North Carolina, where Democratic Sen. Kay Hagan faces a stiff challenge for a new term. It would make residents eligible for long-term benefits if the state negotiates an agreement with the Department of Labor. North Carolina residents are currently ineligible because state benefits were reduced below a federal standard. read
Unemployment extension will need citizen action BY GEORGE ZORNICK January 20 Washington Post
The economic fortunes of nearly 5 million Americans will be determined in the next two weeks, as Congress moves to consider an extension of long-term jobless benefits for perhaps the last viable time. At this point, it appears only one thing can save those benefits: loud voices from constituents that wavering members are unable to ignore. And they have to arise immediately.
Congress is home for one week and ...When senators return in two weeks, there is likely to be a vote on the Reed-Heller temporary extension of unemployment benefits, as Greg Sargent has reported. The...normal levers that might have made a “yes” vote possible are quickly ossifying. ...the Sunday political talk shows came and went with barely a mention of the unemployment benefit fight that consumed Washington just a couple weeks ago...
It’s also unlikely to be an all-consuming priority for the president. ...on the same day House Democrats were making a public push for a vote on extended benefits, Obama was in North Carolina talking about manufacturing. ... it’s a simple fact that extending jobless benefits won’t be Obama’s singular focus with so many other issues going on... In short, the only realistic hope for an extension is old-fashioned politics. Members have to hear a loud and clear message this week from constituents and stakeholders back home that not extending benefits is simply unacceptable. read article
Also read CNN article:
Jobless benefits don't cause unemployment, which begins:
"The Republicans appear to think North Carolina has the answer to their latest conundrum: how to sidestep growing calls for extending unemployment benefits."
War on the Unemployed
By PAUL KRUGMAN
June 30, 2013
...there’s a nationwide movement under way to punish the unemployed, based on the proposition that we can cure unemployment by making the jobless even more miserable...
Consider, for example, the case of North Carolina. ...its unemployment rate, at 8.8 percent, is among the highest in the nation...many of the jobless have been out of work for six months or more, thanks to a national environment in which there are three times as many people seeking work as there are job openings.
Nonetheless, the state’s government has just sharply cut aid to the unemployed. In fact, the Republicans controlling that government were so eager to cut off aid that they didn’t just reduce the duration of benefits; they also reduced the average weekly benefit, making the state ineligible for about $700 million in federal aid to the long-term unemployed.
It’s quite a spectacle...read column
by Chris Fitzsimon
NC Policy Watch
70,000--number of long term unemployed workers in North Carolina who lost federal emergency unemployment benefits as of Sunday June 30 ...
100,000--number of additional long term unemployed workers who will lose federal emergency unemployment benefits before the end of the year ...
100--percentage of the cost of the emergency unemployment benefits that would have been paid by the federal government...
0--amount in dollars of the cost to the state of extending emergency unemployment benefits to 70,000 long-term unemployed workers (Ibid)
North Carolina’s Obscene Attack on Jobless Benefits
Off the Charts July 1, 2013 by Michael Leachman
North Carolina, with one of the nation’s highest unemployment rates at 8.8 percent, imposed cuts in unemployment benefits today that are truly breathtaking:
By Travis Waldron
Feb 19, 2013 at 1:25 pm
North Carolina Gov. Pat McCrory (R) today signed a law that imposes severe cuts to his state’s unemployment insurance program, a change that will also cost jobless workers in the state access to the federal unemployment compensation program.
McCrory’s signature earned him a rebuke from the National Employment Law Project, which said in a release that the law will result in “the most severe cuts to both state and federal unemployment insurance of any state in the nation”:
These heartless cuts, in the state with the fifth-highest jobless rate in the nation, at 9.2 percent, show a shocking disregard for 400,000 unemployed North Carolinians and their families, many of whom will now go from struggling to barely make ends meet to outright struggling to survive. The immediate pain of these cuts will fall on North Carolinians unfortunate enough to lose work through no fault of their own in a weak economy where jobs are scarce. But the entire state will take a hit from the loss of hundreds of millions of dollars in spending at local businesses that would’ve boosted the local and state economies.
Republican state senators have touted the law as “re-employment” program, even though research suggests that workers who receive unemployment benefits search harder for jobs than those who don’t. McCrory, meanwhile, praised the fiscal responsibility of the law, which will allow North Carolina to pay back money owed to the federal government a measly three years earlier than it would have under the old program...read article
Feb., 13, 2013
By ROBBIE BROWN
North Carolina lawmakers approved deep cuts to benefits for the jobless on Wednesday, in a state that has one of the nation’s highest unemployment rates.
In a debt-reducing effort, the Republican-controlled legislature voted to cut maximum weekly benefits to $350 from $535, a 35 percent drop; reduce the maximum number of weeks for collecting benefits to between 12 and 20 weeks from 26 weeks; and tighten requirements to qualify. The cuts would begin with new jobless claims on July 1. If the bill is signed by Gov. Pat McCrory, as expected, North Carolina would be the eighth state to roll back jobless benefits under the growing financial burden of the recession.
February 11, 2013
by Sarah Ovaska
The Obama Administration’s federal labor department says the plan to overhaul North Carolina’s unemployment insurance system would kick 170,000 jobless off of benefits this summer, and have the state’s economy miss out on $780 million in federal funds...
Acting U.S. Labor Secretary Seth Harris released a statement late Monday saying that the federal agency doesn’t have the power to stop the Rebublican-led N.C. General Assembly from moving forward with the plan, but cautioned that families stand to be hurt by it.
The N.C. Senate is ready to move this week on House Bill 4, which proposes to pay off debt the state took on during the height of the Recession by reducing the amount of unemployment benefits workers receive and raising the amount employers pay. Critics of the plan, including the N.C. Justice Center, say the reform unfairly puts the burden on the backs of workers, while businesses that enjoyed years of tax cuts that led to the crisis in the system will walk away bearing a fraction of the cost of righting the system. read full article
By Laura Leslie
Feb 1, 2013
Gov. Pat McCrory says he will sign an unemployment overhaul that will cut off emergency benefits for some 80,000 jobless North Carolinians.
"I will not support the extension of unemployment beyond July of this year," McCrory told a meeting of the Tobacco Growers Association of North Carolina. "I think we need to now draw the line."
New law cuts unemployment benefits in North Carolina
July 9, 2013
North Carolina borrowed $2.5 billion from the federal government to cover its unemployment claims. The state cut long-term unemployment benefits to pay back the loan early, which Gov. Pat McCrory says will help increase hiring.
Jim Axelrod reports. watch video
McCrory says feds should have acted on unemployment
By Mark Binker WRAL July 8, 2013
Gov. Pat McCrory said it was Democrats in Washington, D.C., who failed to avert a change removed benefits for 72,000 unemployed North Carolina workers...Earlier this year, North Carolina changed the duration and generosity of state benefits. That, in turn, triggered federal provisions that ended federally-funded long-term unemployment benefits, which up until July 1 provided help for those unemployed longer than 26 weeks. North Carolina is the only state in the nation to trigger this provision. read article
McCrory won't act to save jobless checks
By Laura Leslie June 26, 2013
State House and Senate Democrats are calling on Gov. Pat McCrory to save federal unemployment benefits scheduled to end July 1 for 71,000 people in North Carolina.
McCrory says that call won't be answered.
The benefits are ending because Republican leaders enacted legislation that cuts state unemployment benefits... "I'm taking a risk," McCrory told WRAL News Wednesday, "but we're going to put more people into jobs as opposed to on government payrolls and paying debt that we don't have a way to pay back."
The overhaul takes effect next Monday. read article
NC alone in choice to end extended unemployment checks
By Bruce Mildwurf June 20, 2013
North Carolina lawmakers had a tough choice this spring: Change how unemployment benefits are calculated, potentially cutting off benefits to tens of thousands of people, or allow the state's debt to the federal government to continue as a drag on the economy.
The Tar Heel state was one of many in the same situation, but North Carolina lawmakers were the only ones who chose the quicker fix. Effective July 1, 71,000 people will see their extended benefits end.
February 14, 2013
by Michael Leachman
North Carolina, where unemployment is over 9 percent, is close to enacting a breathtaking cut in jobless benefits that would surely prove extremely harmful for unemployed workers--and very bad for the state’s economy. Read article from Off the Charts.
Posted on 2/4/2013
by Chris Fitzsimon
Print This Article
80,000--number of unemployed workers in North Carolina who would lose the federally-funded extension of unemployment benefits July 1st under the proposal currently before the General Assembly (Fact Sheet on House Bill 4, N.C. Justice Center, January 2013)
25 million--amount in dollars of federal money coming into North Carolina every week that the state would lose under the proposal currently before the General Assembly (Ibid)
0--number of states that have rejected federally-funded extensions of unemployment benefits for the long-term unemployed(Ibid)
3--number of unemployed workers for every job available in North Carolina (Ibid)
25--percentage of unemployed workers in North Carolina who currently receive unemployment benefits (Ibid)
296--amount in dollars of the average monthly unemployment insurance benefit in North Carolina (Ibid)
26--maximum number of weeks laid off workers in North Carolina may receive unemployment benefits under current law(Overhauling the State’s Unemployment Insurance System: New Proposal Takes NC from the Middle of the Pack all the Way to the Back, N.C. Justice Center, January 2013)
43--number of states that pay a maximum of 26 weeks of unemployment benefits (Ibid)
20--maximum number of weeks laid off workers in North Carolina could receive unemployment benefits under sliding scale in the proposal currently before the General Assembly (Ibid)
12--maximum number of weeks some laid off workers in North Carolina could receive unemployment benefits under sliding scale in the proposal currently before the General Assembly (Ibid)
1--number of states that currently have a sliding scale for maximum length of benefit that begins as a low as 12 weeks (Ibid)
5--rank of North Carolina’s current unemployment insurance system among the 50 states in favorability to business (Tax Foundation, 2013 State Business Climate Index: Unemployment Insurance Tax Component)
33--rank of South Carolina’s current unemployment insurance system among the 50 states in favorability to business (Ibid)
38--rank of South Virginia’s current unemployment insurance system among the 50 states in favorability to business (Ibid)
0.1--percentage of total business costs represented by unemployment insurance taxes (North Carolina Businesses are Not Hindered by Unemployment Insurance taxes. N.C. Justice Center, January 2013)
658 million--amount in dollars of the cuts to unemployment benefits payouts per year in the proposal now before the General Assembly (Ibid)
1 billion--amount in dollars of the potential decline in economic impact in North Carolina from the cuts in benefits in the proposal now before the General Assembly (Ibid)