Cutting Unemployment Benefits Hurts NC Families
As a parent, one of your worst nightmares is not being able to provide for your children. Unfortunately, it’s a nightmare that’s come true for far too many North Carolina parents in recent years due to no fault of their own. With the fifth highest unemployment rate in the nation, tens of thousands of North Carolinians, including many mothers and fathers, are unable to find work, not due to lack of trying, but because the jobs simply don’t exist.
There are currently three unemployed NC workers for every job opening. More than half of workers who have lost jobs have been out of work for more than 26 weeks. Since the beginning of the Great Recession, the median NC family with children lost more than $5,000 in income. North Carolina families are struggling to keep food on the table, clothes on their backs, and the heat turned on.
And yet, after going back into session last week, the General Assembly has prioritized approving legislation that will significantly cut the number of weeks that folks who are out of work can claim unemployment insurance, as well as the amount of unemployment benefits. Under this new plan, the maximum benefit amount would be $350/ week. We all know that is insufficient to meet a family’s basic needs.
This weekend, I spoke to a friend who recently lost her job when the company where she’d worked for over five years downsized. When I asked what unemployment benefits mean to her, she said, “they mean everything. They mean the ability to keep my house out of foreclosure, make sure my kid has what he needs, keep my car so I can get to a new job when I find one. I need them just to get by right now.”
She’s not alone. Despite what some have said in the debate over this legislation, people on unemployment are not lazy. They are tens of thousands of North Carolinians who have worked hard and are actively looking for jobs. That includes many parents trying to care for their kids, who need these benefits to make it just until they can find work.
Much has been made recently of Gov. McCrory’s rationale for raising the salaries of Cabinet members who are already making $121,807. He claims that he’s, “trying to make it at least where they can afford to live.” As parents, we call upon him and the members of the General Assembly to extend that same understanding to our state’s unemployed workers struggling to feed their families.
These proposed changes will also affect federal benefits. The federal fiscal cliff deal penalizes states for altering their unemployment benefit levels by cutting off federal benefits for people who are unemployed for more than 26 weeks. In North Carolina, that’s approximately 80,000 people.
The proposed legislation would also eliminate the family hardship provisions which help families maintain economic security when they lose their jobs due to sudden and unexpected life events. These represent a small portion of the unemployment benefits paid out, but make a huge difference in the lives of families.
The provisions cover workers who lose their jobs because they can’t accept work during particular shifts due to inability to secure care for a child, elder, or disabled family member during those times. They cover any worker who, after giving notice to his or her employer, leaves a job because a child, aged or disabled parent or other immediate family member has a disability or health condition and requires care. And they cover any worker whose spouse is transferred to a geographic location so far away that the worker cannot commute to his or her job. These provisions are meant to help families stay above water, yet they are being eliminated with hardly any discussion.
These proposed cuts are the wrong approach. We got into this mess because lawmakers failed to save for a rainy day during the boom times of the 1990s. Instead of having employers put their nickels and dimes into the piggy bank when life was easy, lawmakers chose to give businesses tax breaks, setting the state up for problems when the Great Recession hit. And now they want North Carolina’s already struggling families to shoulder the burden of repaying the federal government for bailing us out.
Not only is it heartless, it’s bad economic policy. Unemployment insurance can make the difference between staying afloat and financial disaster. It helps put food on the table and injects crucial money into communities that are hurting.
And it isn’t just good for families who struggle to make ends meet; it is also good for the economy. Studies show that the money received as part of unemployment insurance is usually spent right away, and an independent study found that every $1 spent on unemployment insurance stimulated $2 in growth in the U.S. economy. Small businesses, particularly in communities hard hit by job loss, need this money to help keep their doors open and their employees working.
Families should be able to work hard and get what they need -- a good job, food on the table, health care, and a safe place to call home. Yet too many people who want to work, can't find jobs. Cutting off unemployment insurance will only hurt those families more, and further damage the economy.
We call on our lawmakers and Governor McCrory to reject this proposal and to recognize that the right path forward doesn’t leave behind thousands of hardworking NC families.
Beth Messersmith is NC Campaign Director for MomsRising.org and a mother of two.