RALEIGH (July 9, 2020) – This morning the U.S. Department of Labor released the latest weekly data on Unemployment Insurance (UI) claims, showing persistent job losses for working people across the country.

These figures show the deep recession the country is in and the critical role that federal UI programs are playing in stabilizing the income of workers who would not be reached or supported by state programs.

“North Carolina cannot afford the end of the federal program that is providing $600 a week to jobless workers given our stingy state program,” said Bill Rowe, Deputy Director of Advocacy at the NC Justice Center. “Losing that critical income replacement will cause harm to families and ripple through the community as bills for utilities and rent or mortgages are due.”

In North Carolina—where more than 1.3 million people have made claims for UI since March 15th—the federal Pandemic Unemployment Assistance program is reaching people who otherwise would not be eligible but were working in our state’s economy. In the week ending July 4th, 23,606 North Carolinians claimed Pandemic Unemployment Assistance, with the total accessing the program to date at nearly 175,000 people across the state.

This gap in North Carolina’s program, along with the low wage replacement under state UI, mean that the state’s economy is receiving significant support from the federal UI put in place under the CARES Act.

Researchers at the Economic Policy Institute have analyzed the power of the $600/week federal UI payment as providing a quarterly boost to GDP of 3.7 percent and to employment by 5 million jobs.

“Unless Congress acts, the expiration of the $600 a week boost to workers during the week ending July 25th will hurt the economy with losses to demand that will threaten jobs and productivity,” said Alexandra Sirota, Director of the Budget & Tax Center, a project of the NC Justice Center. “Workers are at the heart of our economy. When they cannot go to work or make ends meet and aren’t supported with Unemployment Insurance, the speed and sustainability of our recovery is threatened.”

Today’s data, in combination with recent labor market data released for North Carolina, show that job losses are persisting and the economic harm from COVID-19 is far from over. National data suggests that nearly 11 percent of those out work are not likely to be called back, meaning a sustained commitment to provide support to workers as they navigate the unique job search and training challenges in a pandemic will be critical to returning to a robust and healthy economy.

Analysis released from the Century Foundation quantifies the impacts of the $600/week on the economy and workers with specific highlights on the unique harm in North Carolina which would experience:

  • North Carolina workers will experience a 71 percent decline in UI payments beginning July 26th.
  • North Carolina faces a $364 million loss of income circulating in communities across the state each week beginning July 26th.