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Justice Circle RALEIGH (September 2, 2021) — As North Carolina approaches the Labor Day weekend and the end of federal Unemployment Insurance, the U.S. Department of Labor released the latest weekly data on Unemployment Insurance claims showing just how many North Carolinians will be impacted.
While across all programs initial claims have been declining or remained relatively flat in North Carolina, there were 122,600 claims for Pandemic Emergency Unemployment Compensation (PEUC); 50,700 continued claims for Pandemic Unemployment Assistance; and 31,100 state regular Unemployment Insurance continued claims in the week ending August 28. These numbers give new concerns about the fallout for North Carolina families and communities losing support from federal programs.
Earlier estimates by The Century Foundation found that 130,000 would be impacted while this latest data suggests that the combined impact of the loss of the $300 per week boost or any wage replacement provided through federal programs could affect upwards of 200,000 North Carolinians.
The end of federal Unemployment Insurance programs affects those jobless workers who were newly eligible under programs made available due to the pandemic, have self-employment income, and who received the additional $300 in wage replacement as claimants for state or federal Unemployment Insurance. It will disproportionately harm Black workers and workers of color as well as women and those with disabilities, as the National Employment Law Project noted in their analysis. Federal programs play an important role in addressing disparate experiences of job loss and in making up for low wage replacement in states with higher Black populations.
The North Carolina Justice Center recently released a fact sheet outlining the programs and workers who would be affected.
The loss of federal programs comes at a time when North Carolina continues to have one of the lowest weekly benefit amounts in the nation, replacing just 23 cents for every dollar of prior wages earned. Low levels of wage replacement put a greater financial strain on households and in turn affect the level of economic activity in communities as people stop spending and struggle to meet bills like rent or utility payments.
“Unemployment Insurance provides a critical stabilizing force in the local economy, keeping people spending and engaged in looking for jobs while jobs return,” said Bill Rowe, Deputy Director of Advocacy at the North Carolina Justice Center. “We are still in a precarious stage of recovery and North Carolina will need state leadership to fix our own Unemployment Insurance system and make sure jobless workers are immediately supported so poverty doesn’t grow worse across the state.”
One option for support is already underway with administrative agencies working to help people get back to work by providing them with connections to programs that will stabilize their household income so they can keep searching for jobs and get training for new jobs. These efforts to provide information to those directly affected by the loss of federal programs across the state are an important first step.
A more comprehensive plan to help people replace the income that will be lost in the near term will be needed.
Data released yesterday shows that in 95 counties there are more people looking for work still than before COVID-19 hit our state.
“The reality is that North Carolina has to prioritize helping people to get through this downturn to a better place,” said Alexandra Sirota, Director of the Budget & Tax Center, a project of the NC Justice Center. “Replacing lost wages works and North Carolina has the funds to provide that income support to jobless workers. Without it, the state risks growing hardship and further diminishing the potential for a strong, just recovery.”
With federal leaders’ failure to act, state legislative leaders should meet their responsibility to the people of this state and ensure that a robust back-to-work agenda is in place.
Such an agenda would include fixes to the state Unemployment Insurance system and provide income supports to families with low incomes alongside investment in workplace protections, access to affordable child care, training, transportation, and housing that ensures working families stay connected to the labor force and maintain stable employment.