NC Budget and Tax Center

Allan Freyer contributed to this blog post

The American Dream is continuing to slip out of reach for many North Carolinians. Far too often, working hard just isn’t enough to lift many of North Carolina’s low-income workers out of poverty, according to a new report from the NC Budget & Tax Center.

As we mark the 50th anniversary of the War on Poverty, the report finds that the persistence of economic hardship in North Carolina is largely due to a changing economy and the replacement of middle wage jobs in manufacturing with poverty wage jobs in the services sector. As a result, public investments in the safety net—such as food assistance and tax credits for working families—and economic development programs are often all that stand between low-wage workers and deep poverty. Far from failing, these are the programs that have lifted hundreds-of-thousands of Tarheel workers out of poverty while also helped those living just-above the poverty line too.

Specific findings include the following: Read More

Income inequality continues to be a hot issues in our state and national policy debate, as the highest earners continue to pull away from everyone else in terms of overall income growth. As the latest issue of Prosperity Watch lays out, the top 1 percent of earners have seen their income double over the past 25 years, while the bottom 99 percent have seen their incomes remain almost flat. See the latest issue for more details.

Among one of the more misguided notions in the debate over unemployment insurance is that any job is a good job and unemployed workers should take what they can get.  Not surprisingly, this isn’t only bad for workers but the economy as well particularly when there aren’t enough jobs to go around.

As part of the unemployment insurance changes that went into effect in July 2013, a new definition of “suitable work” was established.  By this definition, after 10 weeks of receiving unemployment insurance, someone would have to take any job that they are offered that pays 120 percent of their weekly unemployment insurance payment.  If they didn’t they would lose unemployment insurance.

Of course, in a labor market where there are 3 unemployed workers for every job opening, the chances of getting a job offer are slim.  And the reality is that many of the jobs that are being created pay less than the jobs that were lost.

So what does this “suitable work” provision mean to workers?  A jobless worker who is receiving the average weekly benefit amount of $245 would have to take any job that pays $15,288 a year.  That is well below the poverty threshold for a family of four and a quarter of what it actually takes to make ends meet in our state.  A jobless worker at the maximum benefit amount of $350 would make $21,840, still below the poverty threshold for a family of four. Read More

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.” Read More