Unemployment claims climb in N.C.

By Scott Nicholson

North Carolina’s unemployment claims are rising, putting a squeeze on the available funds, though so far there has been no local change in claims processing.

With half a million jobs lost in November, the national unemployment rate rose to 6.7 percent. A federal law adopted last year provides for emergency unemployment compensation for up to seven weeks to workers who have used up their unemployment benefits. The law also provided an additional 13 weeks of benefits to workers in states with high unemployment rates, defined as 6 percent or higher.

North Carolina’s unemployment rate is hovering around 7 percent, making it one of 18 states eligible for the additional compensation. Like many states, its claim payouts are surpassing the amount going into the fund, with the state fund losing $70 million from Nov. 1 to Dec. 11.

John Greene, assistant manager of the Boone branch of the N.C. Employment Security Commission, said there had been a significant increase in local unemployment claims, though Watauga’s unemployment rate is still among the lowest in the state at around 4 percent.

“There’s normally an increase this time of year,” Greene said. “But we’re seeing a significant increase because it’s hitting construction, retail and other job sectors.”

Though one of the 18 states in “jeopardy,” North Carolina’s fund drain is not as significant as those faced in states like California, whose fund declined by $276 million over the five weeks leading up to mid-December. Illinois fell behind by $111 million, Louisiana by $186 million and Florida by $82 million.

Michigan, despite an unemployment rate of 9.3 percent, was the only state to see its fund grow during that period. However, the Federal Unemployment Account loaned $613 million to its state fund due to job losses in the automotive sector, and Indiana has been loaned $54 million.

North Carolina still has $288 million remaining in its unemployment fund, which comes from a federal and state unemployment tax on payrolls. The federal portion makes loans to states as needed and is also used to cover extended benefits.

Greene said typically those filing eligible claims would get their first check two weeks later, with a one-week waiting period required. He said there were no delays in processing and claims were still going through smoothly.

“We’ve still got enough to get by on,” Greene said, though he said continued high unemployment could eventually put a strain on the trust fund.