NC Budget and Tax Center, Uncategorized

Ask the jobless if cutting unemployment insurance has helped their job prospects

Jim Lind is a decorated US Air Force vet and a software development professional who’s done it all over a 39-year career: managing and developing for commercial industries, for the military, for education systems, for space systems, you name it.

He’s also been unemployed since early 2009 when the Great Recession resulted in major layoffs at his and so many other workplaces. When Jim finally found work for a contractor for Amtrak, the sequester cut that short just 10 weeks into the job.WP_20140220_005-edit-600-web

Jim was one of eight unemployed professionals who met with U.S. Rep. David Price and Wake Tech President Stephen Scott last week to explain the human toll exacted by North Carolina’s reckless changes to its unemployment insurance program, detailed by a recent Budget and Tax Center report on the issue. They also spoke about how important the programs at the community college have been for them.

“The reason I am here is to talk about who the unemployed are. Who are we really. Myths are not helpful for becoming re-employed,” he said.

Jim explained that the federal extensions of unemployment at a higher weekly rate than is available now were a life saver for him, providing the most basic assistance to eat and pay some bills.

“I had to count slices of bread, eggs in the fridge, measure things in ounces, plan when to wash my clothes in order to be able to pay the rent where I was living,” he said. Plus, even looking for work in today’s world requires expensive tools like a cell phone, an Internet connection and computer, a car. “I don’t know how cutting people off…is helpful for people finding work.”

But last summer, North Carolina’s lawmakers essentially did just that. They reduced the maximum amount of time and weekly benefit amount drastically, as well as how those benefits are calculated. By doing so, the state’s unemployed became ineligible for federal extensions of benefits that ended nationwide at the end of December.infographic

The result is that unemployment insurance payments declined to an average of $245.98 per week in December compared to $301.89 in July 20 13, according to the BTC report. The reduction is enough to feed two people for a month.

In the process, about 70,000 people lost their insurance payments in July, and thousands of others exhausted their state payments with no option for federal extensions.

Today, fewer than two in 10 unemployed people in North Carolina actually receive unemployment insurance payments, the report states.

Yet the job searches continue for most. Tens of thousands of North Carolinians pound the pavement networking, volunteering, taking continuing education classes and doing anything that might result in a job lead. They want to work, to be productive and valued and to provide for their families.

But the reality is that there are still three people for every one job opening in North Carolina. And what the long-term unemployed are finding is a bias against them for being unemployed for jobs that match their experience yet being considered overqualified for those less senior openings.

Doug Perschbacher is a chemical engineer and marketing and sales professional with 30 years’ experience. He and his family were transferred to North Carolina as part of a corporate restructuring, then 16 months later another restructuring eliminated his job.

His state unemployment payments ended around Thanksgiving, right when his wife was diagnosed with a heart condition that limits the work she can do.

Doug said employers with jobs that pay $10-$15 an hour perceive that they are taking a risk hiring someone like him and investing in training him if he’s going to continue looking for more suitable work.

“My options are really finding a professional job,” he said.

Willistine Pearce lost her job in July as an administrative assistant. She’s a single mom whose insurance payments ended in December. She now relies on small child support payments and the generosity of her extended family that have their own expenses to deal with.

“I feel like I shouldn’t have to go to them for help,” she said.

Just as Willistine’s fortunes affect her extended family as they sacrifice to help her, all North Carolinians are harmed when some of us can’t contribute to our full potential. Unemployment insurance had at least provided the support to let families continue to put some food on the table and pay basic bills. With unemployed workers having even less to live on, spending in local communities has been compromised, states the report, and that “will create a ripple effect through the economy.”

Rennie Bidgood lost her job as a technical writer after returning from medical leave  in 2011. She was one of 10,000 people her company laid off at that time. Her federal extended unemployment payments stopped in July with the state overhaul.

Rennie has depleted her savings and is now living off her retirement, forced to pay tax penalties for tapping it early.

“I wish they would change some laws and really be a government of the people for the people,” she said.


  1. Gene Hoglan

    February 24, 2014 at 10:42 am

    This is a feature, not a bug in late-stage capitalism. Some people will be rendered extraneous and unnecessary.

  2. Jim Lind

    February 28, 2014 at 5:11 pm

    @Gene Holgan – so any notion that I would earn enough to pay for food, shelter and basic medical in some indefinitely sustainable manner is extraneous? I suppose I should just become permanently extraneous and die thereby relieving late-stage capitalism of my apparently unnecessary (and possibly harmful) presence? Is this the kind of post-apocalyptic nightmare we have become?

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