This week we will be following up on the State of Working North Carolina report with briefs on specific issues worker’s face in the current economic context. We will highlight here and in those publications the effective policies that can deliver expanded opportunity and shared prosperity for workers and the economy.
Today, we released a brief on long-term unemployment in North Carolina. Nearly half of North Carolina’s workers have been out of work for six months or longer. The more time out of work, the greater the loss in earnings for workers and the greater the strain on the finances of a household. Continued long-term unemployment can also lead to a growth in discouraged workers and a decline in the labor force participation rate–all of which worsen the prospects for sustained economic expansion.
The primary driver of long-term unemployment is the lack of jobs. And so, while North Carolina pursues better policies to create good, quality jobs, one critical tool to sustaining the economy and addressing the economic hardships faced by workers who have lost their job through no fault of their own is unemployment insurance.
Unemployment insurance payments have represented a growing share of the state’s total personal income over the period of the Great Recession. In the recovery, unemployment insurance represents more than 1 percent of the total state personal income. By comparison, the total personal income of workers in furniture manufacturing, textile manufacturing, building construction and nursing and residential care facilities were each less than 1 percent of state personal income.
As the unemployment remains high–and even increases–extending the emergency unemployment insurance program at the federal level is critical. And identifying and improving policies to connect those who have been out of work the longest to jobs is critical.