Another economist, David Ribar from UNC Greensboro, has provided an analysis of what is happening in North Carolina’s labor market and it doesn’t support the outrageous claims being made about employment improvements from unemployment insurance changes.  The entire piece is worth a quick read  here. This is the key finding.

Figures from the U.S. Bureau of Labor Statistics indicate that the number of non-farm jobs in NC increased 1.35 percent from June 2013 (the month before UI was slashed) to November 2013 (the latest month available).

Over the same months in 2012, when the more generous UI state and federal systems were in place, the number of non-farm jobs increased by 1.50 percent.

Nationally, job growth from June to November was faster in 2013 than in 2012, so NC’s slowdown bucks the national trend.

 

Paul Krugman, economist with Princeton University, wrote a piece on the “Raleigh Experiment” with unemployment insurance cuts this weekend.  His assessment:

there is no sign at all that North Carolina’s harshness has done anything except make the lives of the unemployed even more miserable

Among the data points that Krugman highlights are no rapid acceleration of the state’s employment growth relative to the nations after benefit cuts and the unprecedented decline in the labor force.

As the Senate takes up the vote on extending emergency federal unemployment insurance today, one argument by opponents is that it should be paid for.  The good news for opponents of helping jobless workers is that there is a bill to do just that AND start to re-balance our deficit reduction efforts.

The Stop Tax Haven Abuse Act would raise $220 billion over the next decade by closing corporate tax loopholes that provide no economic benefit and reward profitable companies that offshore their profits or otherwise seek to evade taxes.  In some cases, these companies are rewarded for shipping jobs overseas too.

So if opponents are serious about their new-found fiscal responsibility, they should move the Stop Tax Haven Abuse Act to the floor without haste.  But they should not fail to extend unemployment insurance payments to jobless workers in the meantime.

Jobless workers continue to face too few jobs and mounting financial pressure that will flood the economic recovery. The Congressional Budget Office estimates that failing to extend emergency federal unemployment could result in the loss of 300,000 jobs as jobless workers fail to spend in the economy and businesses stop hiring or cut back.

Closing corporate loopholes and extending unemployment insurance at this fragile point in the recovery would not only be good for the economy but makes good fiscal sense.