Changes made to North Carolina’s unemployment insurance system a year ago have caused pain for North Carolina workers and communities, according to a new report by the NC Budget & Tax Center. Center analysts project things will get even worse for many jobless workers because of new limits to how long anyone can receive insurance that took effect this month. Here’s an excerpt from the report:
Two changes—lowering the maximum duration of weeks and a new formula that significantly reduces average weekly insurance amounts—fall most heavily on jobless workers in areas of the state’s highest unemployment, and primarily in rural counties. The cumulative effect of these changes is a double whammy for people out of work through no fault of their own – the amount of money they can collect has gone down and so has the number of weeks they can collect it.
As of July 1, North Carolinians who have lost their job through no fault of their own will be able to receive a maximum of only 14 weeks of unemployment insurance compared to the previous maximum of 26. No other state offers fewer weeks. Meanwhile jobless workers qualifying for unemployment insurance will get nearly $300 less on average each month.
The combined result will be a significant reduction in the capacity of jobless workers to afford the basics for their families, let alone put gas in their cars to get to job interviews. And the ripple effect of these policy changes suggests the potential to slow the state’s economy.
The report also notes that the recent decline in North Carolina’s unemployment rate has been caused in part by people leaving the labor force, rather than finding work. In other words, the state still has a huge jobs deficit.
The average weekly unemployment insurance payment in May 2014 was less than $228, the 44th lowest weekly benefit in the nation.
To read the BTC’s full report, click here.