With nearly 30,000 unemployment claims in NC, too many workers are blocked from accessing the state UI program

RALEIGH (June 25, 2020) – The United States Department of Labor released the most recent Unemployment Insurance (UI) claims data today, showing advanced claims of more than 1.4 million during the week ending June 20th. Meanwhile, North Carolina weekly data for the same period shows nearly 30,000 claims in that week.

In these unprecedented times, the changes to UI that were rejected by North Carolina lawmakers earlier this spring set up further challenges for the state’s long-term recovery which will depend on a strong state unemployment insurance system. Even before the current crisis, North Carolina offered too little in benefits for too short a duration to too few people who needed it.

“Our legislature needs to focus on the state’s Unemployment Insurance program as an essential tool in fighting COVID-19,” said Bill Rowe, Deputy Director of Advocacy at the NC Justice Center. “Our current system is among the stingiest in the United States. Changes are needed—and support for the agency to administer the program under significant strain—so North Carolina can effectively send support to those people feeling the impact now and in the future.”

Unemployment Insurance represents a critical state and federal system during downturns as it stabilizes households and the broader economy by providing temporary, adequate wage replacement. Yet as a report released today by the Budget & Tax Center shows, too many workers across North Carolina are blocked from accessing the program, the system itself has been underfunded, and the resulting wage replacement provided is inadequate.

While UI is a state-federal partnership, North Carolina for years has fallen short in making the commitments to ensure the system can serve its role in protecting workers from further economic harm, minimizing the long-term negative impacts on health and well-being, and stabilizing local economies. A strong UI system — at both the federal and state level — recognizes the central role that workers play in the well-being of the economy. Without the contribution of workers, businesses lose demand and communities lose income. The well-being of workers will determine the strength of the economic recovery.

“North Carolina’s state Unemployment Insurance urgently needs a fix that ensures workers in the COVID-19 recession and future recessions can receive the support that is needed to drive an inclusive recovery,” said Alexandra Sirota, Director of the Budget & Tax Center, a project of the NC Justice Center, and co-author of the report. “In particular, rules and limits that block part-time workers from accessing the program are among the factors driving lower levels of access for workers of color. Without Unemployment Insurance during the loss of jobs and work hours, income losses for Black and brown workers will contribute to the growing racial wealth gap over time.”