Hacking benefits not the answer

Feb. 08, 2013 @ 05:24 AM

Unemployment has been a long-standing issue in North Carolina and Rutherford County.

The unemployment rate in the county has fluctuated between 12 and 13 percent over the last year.

Now, the North Carolina General Assembly wants to make sweeping changes to unemployment insurance benefits that will cap the maximum amount of weekly benefits to $350. That is a drop of $185 per week. In addition, a bill that has already cleared the House will also drop the number of weeks someone can collect unemployment to 20 from 26.

The bill also includes an increase in unemployment taxes for businesses to the tune of $40 per full-time employee.

The reasoning behind the measure is to trim three years off the amount of time it will take for the state to pay back a $2.6 billion loan from the federal government to cover the unemployment insurance trust fund that was depleted in the 90s when the General Assembly decided to give money out of the fund back to businesses because unemployment was low.

The bottom line is that the state is in a pickle and those without jobs will be burdened with getting them out of the problem.

Unfair might be a drastic understatement when it comes to describing the provisions of the bill.

We understand that the debt has to be paid and we do agree that the earlier the bill is settled, the better the state will be. But, drastically cutting unemployment benefits by amount and duration is not the lone solution to the problem.

There has to be some kind of compromise. This would be an easier pill to swallow if the cut was not as deep and long-lasting.

Another provision of the bill that has us stymied is the fact that, in 2015, the tax increase on businesses will sunset, or go away, however the cuts to benefits remain in place.

That, in and of itself, is not fair to the hard-working people of North Carolina that are unemployed through no doing of their own.

If businesses are content with letting their share of the bill go away once the debt is paid then the state should be content with putting benefits back to where they were.

The solution here is simple ... if the state is going to cut benefits, do so but don’t make it as drastic of a cut as what has been proposed. Businesses who received a nice windfall in the 90s should also be willing to kick in a little more. There is also no call in making North Carolina the only state where benefits are capped at a maximum of 20 weeks.

It may make it a more business-friendly climate — as proponents of the bill have argued — but it could also lead to employees choosing not to work in North Carolina because of the threat held over their head of minimal benefits if they are let go.

The bottom line is that the unemployed will hurt, local economies of places like Rutherford County will hurt and it is all because of a bill that focuses more on dollars and cents and less on the faces that are attached.

By Matthew Clark, for the Editorial Board

 

The Daily Courier Editorial Board consists of community members Jerry Brewer, Kyle Bingham, Tom Padgett, Dr. Shermaine Surratt and Cliff Strassenburg as well as Editor Matthew Clark.