NC Budget and Tax Center

Unemployment insurance fix is needed

The Election Day exit polling of North Carolina voters found many deeply concerned about the economy and the inability of people in communities across our state to secure a foothold in the middle class.  We shouldn’t be surprised by that.

The recovery from the Great Recession has been slow and failed to deliver the kind of broad wage growth that delivers the benefits of expansion to the most people.  Instead, North Carolinians have experienced wages below where they were in 2007. Meanwhile too few jobs are available in many communities across the state.

Gateway communities—those small towns and cities—that served as the hub of manufacturing and the connection to economic opportunity for rural places were particularly hard hit in the recession and recovery with the loss of jobs in manufacturing and its failure to recover.  But these communities have continued to be hit with mass layoffs and have seen state policies that used to help get radically altered.

Today legislators gathered to discuss the unemployment insurance system but this broader context was absent as were the stories of the harm of changes made since 2013.  The unemployment insurance changes made in 2013 provide just one example of policy choices that put working people at a disadvantage when they have lost a job and need a hand up the most. By failing to design the system to cover a significant share of those who have lost their job through no fault of their own and to provide payment that is relative to the wages earned through prior work, the system is not as effective at ensuring that jobless workers can meet basic needs and stay attached to the labor market thus reducing demand for businesses goods and services.

It is time to fix NC’s unemployment insurance system so that it provides meaningful support for laid off workers, their families and their communities as they work to get back on their feet.

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