As of Monday, changes in the unemployment benefits that many Macon County citizens receive went into effect. The new law cuts off extended federal benefits in an attempt to pay off some of North Carolina's $2.5 billion debt in unemployment claims.
North Carolina has the third highest debt in the country behind New York and California and is ranked fifth in unemployment nationally. Lawmakers opted to change aspects of the unemployment compensation laws to try and get a handle on the massive debt to the federal government. Legislation passed and the Governor signed the bill that would reduce the time that citizens can receive compensation from 26 weeks to 19 weeks, as well as reduce the amount being paid out from a maximum of $535 to $350.
The new law goes into effect right as May's county employment figures were released and showed an increase in unemployment rates for 87 of the 100 counties in the state. Macon County saw its unemployment rate decrease to 9.8 percent from 10.2 percent in April. Its labor force totaled 15,886 while its unemployed totaled 1,556. In the same month in 2012, the rate was also 9.8 percent.
As of April, Macon County was ranked 74th in the state for its unemployment rate. However, fluctuations do occur in the data based on seasonal variations. According to the data released from the state employment office, the Asheville area came in with an 8.1 percent increase to the work force in leisure and hospitality type jobs. A similar scenario would cause employment to be on the rise in Macon County.
“We're just thrilled to see that our rate is below 10 percent,” said Dale West, manager of the N.C. Employment Security Commission office located in Franklin. “Obviously we're seeing trends. Our rate was 9.8 percent last year in May as well, but we are hopeful. We do have 65 job orders at our office right now so that is a good thing.”
The question on many people's minds is, how will the enactment of this new law affect those who rely on these benefits?
“The state is trying to balance out the deficit problems by punishing the people who have lost their job and are trying to survive on what little they can,” says Logan Wallace, president of the Macon County Young Democrats. “This cut will be a crippling blow on the unemployed even though they are trying harder than ever to get back on their feet.”
Senator Jim Davis who represents Macon County and supported the legislation believes this will be a step in the right direction towards paying back the state’s debt.
“By reducing the compensation that people will receive, we are putting the state back at the average for payouts,” he said. “North Carolina has had inflated unemployment benefits for years and this plan is going to help pay off that $2.5 billion debt by 2015.”
When Gov. Pat McCrory signed House Bill 4 in February, he proclaimed that it was the first step towards paying off the debt and reforming the state’s unemployment insurance system.
“This bipartisan solution will protect our small businesses from continued over-taxation, ensure our citizens’ unemployment safety net is secure and financially sound for future generations, and help provide an economic climate that allows job creators to start hiring again,” he said.