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For the long-term unemployed, benefit cuts are another blow

By Laura Finaldi
lfinaldi@newsobserver.com

On July 1, a new North Carolina law changed the state’s unemployment benefits, reducing the maximum weekly payout from $535 to $350 and the eligibility from 26 weeks to between 12 and 20, depending on the unemployment rate.

The change, enacted by the N.C. legislature this session, also effectively ended extended federal unemployment insurance to more than 65,000 long-term unemployed.

As more people see their state benefits expire in the coming months, advocates for families worry about the short- and long-term effects on children.

“What we’ve found is that unemployment insurance for families with kids is oftentimes kind of a lifeline, to make sure the needs of families continue to be met, to make sure basic needs are taken care of – like putting food on the table, paying rent, keeping the AC on,” said Laura Speer, associate director of policy reform and advocacy at the Annie E. Casey Foundation, a child research and advocacy group. “It’s a critical measure for a lot of families, and it can be the difference between a family being able to keep a roof over their heads or not.”

A March report from the Urban Institute called “Unemployment from a Child’s Perspective” uses 2012 data and estimates that 10 percent of children in North Carolina lived in households with at least one unemployed parent, a 140 percent increase over five years. It also found that 58 percent of those children, or 6 percent of all children, had parents who were considered long-term unemployed.

Losing benefits may make things difficult for families in the short-term, but cutting unemployment insurance will lead to a more sustainable state economy with many new jobs in the long run, said Gary Salamido of the North Carolina Chamber, a pro-business group that lobbied for the cuts. The state owes the federal government over $2 billion it borrowed to account for a surge in unemployment during the recession.

Because businesses, not individuals, are the sole contributors to the unemployment insurance fund, cutting benefits reduce the burden on employers, according to the Chamber.

The Charlotte metro region’s unemployment remains stubbornly high – 8.9 percent in June. The state’s unemployment rate was 8.8 percent in June, the fifth highest in the country.

The state is trying to help those who have lost their benefits by offering resume preparedness, career guidance and information on the job market.

“We really do feel that the best thing that we can do for folks that are out of work is to help them find a job,” said Josh Ellis, a Department of Commerce spokesman. “If we can use our workforce to notify people of additional resources, we will do that.”

But Jennifer Campbell, who lives in Kannapolis, said last month that being prepared to enter the workforce is not the issue. It’s jobs.

Campbell, who is married with three children ages 19 months, 5 and 8, lost her insurance job in December and was on federally extended benefits for three weeks before they expired. The family gets by on the $350 a week her husband makes at his commercial air duct fabricating job, but the loss of her income forced them to sell their house and move in with her husband’s grandfather.

Campbell said her biggest worry is the safety and health of her children, who are on Medicaid.

“There just aren’t a lot of jobs in the area,” she said. “It’s just terrible.”

Finaldi: 919-829-4582 or twitter.com/lauraefinaldi
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