News
Wednesday, January 22 2014 • page 9
After six months, unemployment insurance may return to NC
Michael Papich
Assistant News Editor
The United States Senate’s top
priority for January has been the exten
sion of expired federal unemployment
insurance-a reality in North Carolina
for nearly six months.
Federal unemployment insurance ran
out at the end of 2013, and the Senate
is currently working on legislation to
extend those benefits until March. But
in North Carolina, the state’s Gen
eral Assembly reduced unemployment
insurance payments from a maximum of
$500 to $350 each week. The bill also
trimmed the length of time someone
could receive unemployment benefits
from 26 weeks to 12-20 weeks.
This disqualified North Carolina
from emergency unemployment insur
ance the federal government supplies
states in need. Sen. Kay Hagan, D-N.C.,
amended the Senate’s bill to extend
federal benefits to reinstate North
Carolina’s emergency unemployment
insurance.
“As we slowly regain jobs lost during
the Great Recession, out-of-work North
Carolinians should not suffer because of
the General Assembly’s reckless actions.
And even though our state’s unemploy
ment rate continues to decrease, the
long-term unemployment crisis - and
the North Carolinians who cannot find
work - should not be ignored,” Hagan
said in a statement.
Whether North Carolina gets that
emergency unemployment insurance
is up to Gov. Pat McCrory, who has
declined to say what he would do if the
Senate’s bill passes.
Tom Tiemann, professor of econom
ics at Elon University, said the reduc
tion and eventual loss of unemployment
insurance in North Carolina hurts the
state’s chances of regaining jobs.
“There’s been less money coming
in for people to spend,” Tiemann said.
“Money coming from the outside helps
not only when people spend for them
selves, but that spending creates jobs.”
Tiemann explained by saying that
when a person uses an outside dollar to
buy groceries, for example, that grocer
then has that dollar to spend, so it has
more effect in the economy than just
one dollar.
“People on unemployment insurance
don’t save any of it,” Tiemann said. “It
has a very high multiplier effect.”
Living unemployed
Kim Crawford, executive director of
Allied Churches, a homeless shelter and
resource center in Burlington, said a loss
of unemployment insurance usually does
not mean that someone immediately
goes to the shelter.
“They have a few more steps, general
ly, before they end up with us. They run
out of unemployment and so they sell
their car and their other belongings and
their house gets foreclosed on,” Craw
ford said. “Then they end up with us.”
Betsy Strauss, program manager at
Alamance County’s Women’s Resource
Center, said the loss of unemployment
insurance puts a strain on the women
she sees because they are often the sole
worker in their household.
“They become homeless, or they
manage to get into a shelter, or they are
going from friend to friend or relative to
relative,” Strauss said.
Crawford said many in Allied
Church’s shelters have jobs, but they are
usually in the service industry, which are
minimum wage and part-time, which
Crawford said is not enough to live on.
“The unemployment benefits can
help you stay where you are. It can help
you at least maintain a living,” Crawford
said.
The impact of losing unemployment
insurance is particularly difficult to
those Strauss works with because many
were already underemployed to begin
with. The Women’s Resource Center
works with women in the area to get
additional job training, but Strauss said
a good percentage of her clients have at
most a GED.
“To have actually finished high school
within the traditional four years, we
if
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Senator Kay Hagan said the state’s residents shouldn’t suffer for the General Assembly’s “reckless” actions.
don’t see too many of those people,”
Strauss said.
Not hiring
Tiemann addressed the theory that a
loss of unemployment insurance would
further encourage individuals to find
work because they would need a pay-
check even more.
“If there’s no jobs to be had, it doesn’t
make any difference,” Tiemann said.
Since the reduction in unemployment
insurance. North Carolina’s unemploy
ment rate has dropped over 1 percent.
However, 100,000 North Carolinians
also left the workforce altogether, which
meant they were not counted as unem
ployed, creating an artificial decrease in
the unemployment rate.
“If the economy starts to grow and
people aren’t looking for work, then it
won’t grow back as quickly as it other
wise could,” Tiemann said.
Crawford said many people she sees
at Allied Churches are part of that
group of “discouraged workers” because
jobs are not available.
“Most of the jobs are in West Burl
ington, and most of the affordable hous
ing is in East Burlington,” Crawford
said.
The alternative is a commute that can
be difficult without transportation.
“It’s not uncommon for people who
are living in the shelters to be walking
four to six miles, one-way, to get to work
for a part-time job that pays $9 an hour,”
Crawford said.
Strauss said unemployed people in
other parts of Alamance County face the
same difficulty.
“There is no bus service in Burling
ton, other than the Elon bus,” Strauss
said. “And if they’re living in Graham
or one of the outlying communities,
unless they are within walking distance
of a place of employment, they’re up the
creek without a paddle.”
Strauss added that moving can be an
expensive process, considering security
deposits and additional rent required for
a current home.
According to the Congressional Bud
get Office, the United States is currently
in the longest period of sustained high
unemployment since the Great Depres
sion. Tiemann summarized the solution
to the problem in one word: spend.
“If your credit card is running out and
your kitchen’s empty and you’re starving,
you go out and buy food and don’t worry
about the card’s debt,” Tiemann said.
“It’s more important to get employment
pumping. It’s a silly time to balance the
budget.”