NC Budget and Tax Center

SNAP works for North Carolina’s children

The Supplemental Nutrition Assistance Program (SNAP) helps North Carolina families put food on the table. But we know now that it accomplishes much more than that.

Research increasingly shows that SNAP, formerly known as Food Stamps, can ward against the long-term effects on children experiencing poverty, abuse or neglect, parental substance abuse or mental illness, and exposure to violence — events that can take a toll on their well-being as adults.  As a new Center on Budget and Policy Priorities report finds, SNAP helps form a strong foundation of health and well-being for low-income children by lifting millions of families out of poverty, improving food security, and helping improve health and academic achievement with long-lasting consequences.

It’s doing all that across North Carolina. SNAP is improving our children’s futures.

SNAP delivers more nutrition assistance to low-income children than any other.  This year, SNAP will help about 20 million children each month — about one in four U.S. children — while providing about $30 billion in nutrition benefits for children over the course of the year. In North Carolina the impact is even greater. In 2014, SNAP helped about 663,000 children each month, or 29 percent of our state’s kids.


SNAP’s benefits are modest, but they’re well-targeted to children and families that need them the most. While households across the state receive an average of $255 each month, families with children get $390 on average. Furthermore, families experiencing deep poverty receive higher benefits.[i] In 2014, SNAP benefits lifted over 96,000 families out of deep poverty. It’s no surprise that SNAP helps lift more children out of deep poverty than any other government assistance program.

In fact, much of SNAP’s success can be attributed to its design, including that consistent national structure that effectively targets food benefits to those with the greatest need; eligibility rules and a funding structure that make benefits available to children in almost all families with little income and few resources; a design that automatically responds to changes in the economy; and rigorous requirements to ensure a high degree of program integrity.

SNAP is helping to give thousands of North Carolina’s children the foundation they need to succeed. Efforts to reform or enhance it should build on its effectiveness in protecting the well-being of our children — and those nationwide — and preserve the essential program features that contribute to that success.

[i] Deep poverty is defined as income at or below 50 percent of the Federal Poverty Line

Commentary, NC Budget and Tax Center, The State of Working North Carolina

Voters agree: Don’t call it a (Carolina) Comeback

We’ve been hearing a lot about a Carolina Comeback for the last few years, but it turns out that most of us haven’t been feeling it. A recent WRAL News poll finds that only a quarter of North Carolina voters think our state’s economy is stronger than it was four years ago. Additionally, “more than two-thirds of voters said their own economic well-being is either the same or worse than it was four years ago.”

Unfortunately, this isn’t a huge surprise. As the latest State of Working North Carolina report shows, bad policy choices have made overall economic growth, jobs, and changing industry opportunities fall far short of what we all need to thrive. This report, Don’t Call it a Comeback, explains the data that back up how North Carolina voters feel about their economic opportunities.

Hopefully lawmakers will take these poll results as a sign: they need to start prioritizing policy decisions that will create an economy that works for all.

Click here for the WRAL News poll.
Click here to see the NC Justice Center’s latest report, Don’t Call it a Comeback.

NC Budget and Tax Center

Jobless workers and their communities still hurting under unemployment insurance changes

The Unemployment Insurance Oversight Committee is set to meet on Wednesday to discuss the state’s unemployment insurance system.  It is unclear what will be discussed as of today but let’s hope North Carolina’s leaders spend time considering just how poorly the system is working for jobless workers and their communities.

The latest available data from the US Department of Labor provides benchmarks on key standards that the system should meet in providing a temporary, partial wage replacement to those who lose their job through no fault of their own.  The goal of the program is to stabilize these jobless workers spending in the broader economy while they look for new work and ensure that busiensses aren’t hit by the impacts of low demand for their goods and services.

Here are the lowlights for North Carolina’s system:

  • Just one in 10 jobless workers received unemployment insurance in the Second Quarter of 2016, ranking North Carolina last in the country. Prior to changes North Carolina ranked 24th.
  • The average duration of unemployment insurance is just 10 weeks, ranking North Carolina last in the country. Prior to changes North Carolina ranked 31st.
  • The average weekly benefit amount of $241 leaves jobless workers with too little wage replacement to keep up with the basic costs of living and ranks North Carolina 46th in the country. Prior to changes North Carolina ranked 25th.

North Carolina’s unemployment insurance now reaches too few jobless workers for too short a time period and provides too little in payments to stabilize their spending in the economy. In communities facing persistently high joblessness and too few job openings as well as though facing mass layoffs. The failings of today’s unemployment insurance are all too real and the reach of its harm extend beyond those immediately affected to all of us.

Let’s hope these issues get discussed by leaders on Wednesday. Policymakers should choose to fix the state’s unemployment insurance so that it works for jobless workers and communities.

NC Budget and Tax Center

New Report Finds Impact of Immigration is Positive

The National Academy of Sciences (NAS) has just released a new report measuring the impact that immigrants have on federal and state budgets. The report follows up on a 1995 NAS study on the same topic. Since the release of the previous report, the United States immigrant population has more than doubled, from 24.5 million immigrants to 42.3 million in 2014.[1]

The issue of how immigration affects state and local costs as well as the economy overall is a pressing one where rhetoric on this topic has often trumped facts.  The authors find that in addition to the positive net benefits of immigration at the federal level, second generation immigrants produce a long-term net benefit for state and local economies, so long as states educate immigrant children.

Here are some other key findings from the report:[2]

  • Between 2020 and 2030, the only increase in our labor force population will come from immigrants and their children. Therefore, in order to sustain our labor force, a level of immigration is needed going forward.
  • Immigrant workers grow the size of the economy by approximately 11 percent each year. That would amount to approximately $2 trillion in 2016.
  • Immigrants today have more education than previous generations, making them stronger contributors to government finances than immigrants in the past.[3]
  • Second generation immigrants have an overall higher positive impact on the nation’s economy than other immigrant groups.
  • Overall, there was little impact on the economy in terms of wages and employment. The only negative impact was on native-born residents who do not hold a high school degree.

The report also adds to a growing body of research about the economic effects of immigration in North Carolina. In June, for example, the Budget and Tax Center released a report that underlined the benefits of immigration to the state’s economy. The report pointed out the contributions of immigrants as business owners, consumers and workers – pointing out that the long-run effect of immigration was the growth of most native-born workers’ wages.[4] Similar to BTC’s findings, a 2014 report from UNC’s Kenan-Flagler School of Business found that immigration produced a net fiscal surplus for the North Carolina when immigrants’ estimated public cost was subtracted from their estimated tax contributions.[5] The government’s challenge going forward is to introduce immigration policies that better support immigrants as participants in our economy and labor force, and as students in our education systems.

[1] The National Academies of Sciences, Engineering, and Medicine. (2016). The Economic and

Fiscal Consequences of Immigration. Washington, DC: The National Academies Press. doi: 10.17226/23550.

[2] The National Academies of Sciences, Engineering, and Medicine. (2016). The Economic and

Fiscal Consequences of Immigration. Washington, DC: The National Academies Press. doi: 10.17226/23550.

[3] The National Academies of Sciences, Engineering, and Medicine. (2016). The Economic and

Fiscal Consequences of Immigration. Washington, DC: The National Academies Press. doi: 10.17226/23550.

[4] McHugh, Patrick. Smart Choices in an Era of Migration. Rep. Raleigh: Budget and Tax Center, 2015. Web.

[5] Johnson, James H., Jr., and Stephen J. Appold. Demographic and Economic Impacts of International Migration to North Carolina. Rep. Chapel Hill: Kenan-Flagler Business School, 2014. Web.

NC Budget and Tax Center

Tax Foundation’s newest ranking leaves much to be told

We are once again hearing about North Carolina’s business climate moving toward top-ten status among states according to a new ranking by the Tax Foundation, a tax policy research organization that favors tax cuts. North Carolinians should be leery of jumping on the celebration band wagon, however.

As I’ve highlighted before (see here and here), this ranking provides no insight whatsoever regarding the actual fiscal and economic health of the Tar Heel State. Instead, the ranking simply continues to applaud more tax cuts that have largely benefited the highest income earners in the state and profitable corporations. The ranking tells us nothing about the negative impact of the more than $2 billion in annual revenue loss once all tax changes are in place. These tax cuts represent lost resources that could be used to boost investments in public schools, provide health services for the elderly and poor, and ensure that all communities across the state can thrive.

A smart business leader understands that simply being told how much revenue a business generates tells her nothing about whether the enterprise is profitable. Furthermore, a prudent business leader understands the importance of making adequate investments to ensure the long-term success of the business.

North Carolina’s move up the Tax Foundation ranking just means lawmakers have prioritized tax cuts over important public investments in things like public schools so they can offer every child a high quality education. This flawed priority may zip the state up the Tax Foundation ranking, but this supposed short-term gain poses a huge potential long-term cost.