Reduced Benefits Ahead for North Carolina's Newly Unemployed

Next month, some North Carolinians will get fewer state benefits and for less time.

Beginning June 30, unemployed North Carolina workers who apply for state benefits for the first time will get less money. This is the result of a bill Governor Pat McCrory signed into law last February.

Currently, the maximum unemployment benefit is $535 per week. But after June 30, that will decrease to $350 per week.

Members of The North Carolina Justice Center want state legislators to make this change effective January 1, 2014.  Communication's Director Jeff Shaw says reducing unemployment benefits hurts families and small community businesses. 

“Imagine if your paycheck has hundreds of dollars less per week to spend. That means you're probably not supporting your local grocery stores, you're probably not going out to eat, or go to the local coffee shop or buy gifts for your friends. All of these are things that support local businesses," explains Shaw. "When people have money to spend at local businesses, that creates an economic multiplier effect.”

The measure would also allow new claims to only receive benefits between 12 to 20 weeks.  Currently, the maximum period is 26 weeks. But according to Shaw, most unemployed workers exhaust their benefits within 26 weeks while they're still looking for a job.

Shaw believes it's because reduced corporate taxes are not motivating companies to hire more people. “If you look at tax rates on the wealthiest Americans, President Barack Obama's tax rates are lower than President Ronald Regan's," according to Shaw. "Instead of re-investing as we were promised, the wealthiest Americans are keeping more of the money.”  

The North Carolina Justice Center is also urging members of the state general assembly to pass other bills favoring unemployed workers. They include; a measure that would prevent a person from being turned down for a job based on their credit history, another which provides a tax credit to employers who hire unemployed workers and one that creates a work sharing program.