RALEIGH (June 18, 2013) — At a time when North Carolina’s jobs deficit stands at more than half a million, work sharing – an optional program for employers established and administered through the federal-state unemployment insurance (UI) system – can be a powerful tool for responding to the ongoing unemployment crisis, a new report finds.
In 25 states across the country, work sharing has enabled employers to temporarily reduce payroll costs during business slowdowns without losing their skilled employees, according to a report from the North Carolina Justice Center. Moreover, temporary federal subsidies are currently available to states that establish work-sharing programs.
“This support and guidance can allow North Carolina to be proactive in maintaining economic stability and implementing a program that works for employees and employers,” said Sabine Schoenbach, a policy analyst with the NC Justice Center’s Workers’ Rights Project.
Work sharing, also known as short-time unemployment insurance, gives employers the option to reduce employees’ hours instead of implementing layoffs when business is slow. These employees with reduced hours receive pro-rated unemployment benefits – paid out of the UI trust fund – to supplement their paychecks.
Work sharing has been cited as a key strategy in maintaining employment stability during economic downturns according to a variety of economists and policy experts, the report said. Established state programs have been successful in saving nearly 166,000 jobs in 2009 and close to 100,000 in 2010, including in industries such as manufacturing.
“In recognition of North Carolina’s current labor market trends and the great number of jobs lost during the Great Recession, the establishment of a work-sharing program in North Carolina would be a concrete tool to maintain economic stability and avert layoffs during future business downturns, benefitting North Carolina’s workers, employers, and communities,” Schoenbach said.
Read the full report at this link.
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