North Carolina Eliminates Federal Unemployment Benefits

According to multiple reports, the State of North Carolina has cut its maximum weekly benefit unemployment benefit amount from $535/week to $350/week, and has shortened the maximum period of benefits to five months.

The practical effect of this decision will be to disqualify North Carolina from participation in federal unemployment benefits going forward.  Under federal law and regulation, a state that shortens the period of eligibility for benefits, or cuts benefits, loses access to the supplemental federal benefits funds that backstop state benefits funds in times of economic hardship, so-called “extended benefits” providing for benefits beyond 26 weeks in most cases.

Maryland’s maximum benefit amount is currently $430/week.  I was surprised to learn that North Carolina’s prior maximum benefit amount exceeded Maryland’s; Maryland is a relatively liberal, high-tax and high-income state while North Carolina has a lower per capita income, more conservative politics and overall lower taxes.

According to the report, 7000 people in Mecklenburg County (metropolitan Charlotte) are on extended UI benefits and are presently being cut off.  Mecklenburg county has just under 1 million people; this means that about 1% of the adults living in the county had, but have just this week lost, extended unemployment benefits.

 

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