Bill cutting North Carolina's Unemployment Benefits goes to Governor

Bill cutting North Carolina's Unemployment Benefits goes to Governor

7:01pm Feb 13, 2013
Kathryn Mobley

A bill reducing North Carolina’s unemployment benefits is headed to the governor. But  opponents say this move will hurt thousands of North Carolina families and the state as a whole.

“I know manufacturing, I chose it because of my parents and you can make pretty good money. I make $20.41 an hour.” Chandra Byrd is an assembly technician at Thomas Built Buses in High Point. Between 2008 and 2012, she was laid off from the company three times. “At the time I had about $15,000 saved and after that first year it went. I moved to Salisbury and my sister and I got a place together because she was laid off also. So we moved in together to help each other and make ends meet.”

The 40-year-old is single and says has no children. Something she is grateful for because while she got almost $1,700 a month in unemployment benefits, Byrd says it barely covered her monthly expenses. “Once you pay bills, you need gas, you need food, you don’t have health insurance at the time so if you need go to the doctor it’s out of pocket there’s nothing left.” Last January, Thomas Built Buses rehired her.

Byrd is one of thousands of people in North Carolina who says having unemployment benefits kept them from becoming homeless.

In Raleigh Wednesday, Senate members approved 36 to 12 a bill that will reduce the maximum weekly benefit for an unemployed worker from $530 to $350. It will also reduce how long benefits can be received from 26 weeks to a maximum of 20 weeks. And once laid off, workers will have to wait two weeks before receiving benefits. Currently, they wait one week.

Business will also have to pay a little more in unemployment taxes. The state house already passed this measure. Most in Raleigh believe it's the best way to begin paying back the billions of dollars North Carolina owes the federal government in unemployment benefits. But others argue the state is making it impossible for unemployed workers to get back on their feet.

Jeff Shaw is communication director North Carolina Justice Center. “In Guilford County we have the highest number of concentrated poverty communities in the state, at eleven. That means more than 40% of people live below the poverty line. And in one of those communities 60% of people live below the poverty line. It’s our state’s manufacturing centers and our state’s rural communities where you see the disproportionate impact."

According to the U.S. Labor Department, North Carolina’s plan to reduce unemployment benefits will negatively impact 170,000 families and it would mean the state could not use federal unemployment extension benefits, a loss of about $780 million. But the business community says the state must change how it provides unemployment benefits in order to stay competitive.

Christie Burris is the communication director of the North Carolina Retail Merchants Association. “There’s a hiring momentum you’ve seen over the past several months and if we don’t address the fiscal clip in North Carolina, it’s going to stall hiring.”

According to Burris, without this reform, business won't make enough money to potentially hire more workers. “North Carolina employers would pay an additional $21 per employee just on their unemployment insurance tax. And that’s just an increase on the interest to pay that back. And that would be for this year. If they didn’t pay it back this year, that same employer would pay back $42 on top of what they’re already paying. And so from a business perspective that money we’d be paying in unemployment insurance taxes just to pay back the federal debt could be used to invest in expanding their business, capital improvements, new jobs."

If signed into law, these cuts will go into effect July 1. Meanwhile, Byrd says her greatest fear is being laid off again. “Rent is $800, utilities is $300-$400. It doesn’t add up. $350 will not add up to what I need to pay my bills.” So Byrd hopes to finish online accounting classes for a degree so she can have something to fall back on. 

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