NC governor calls for increase in some of nation's lowest unemployment benefits
Gov. Roy Cooper's new budget proposal calls for the first wholesale increase in unemployment benefits in more than a decade, plus a $91 million change in how the state's unemployment system is financed that's meant to boost job training programs.
The measures stand little chance of passage in the North Carolina General Assembly, despite the state's long reputation as one of the stingiest in the country when it comes to unemployment checks. The state's unemployment rate is low, and workforce shortages in both state agencies and the private sector are a higher priority for Republican lawmakers who hold majorities in the statehouse.
"The short answer is no," Senate Republican Leader Phil Berger, R-Rockingham, said Thursday. "I really think increasing the benefit for unemployment at this time is the wrong tack to take if we want to get more people into the workforce."
Last month Forbes Advisor said North Carolina had the 49th worst benefits in the country. The state's average weekly benefit is $236 and the average payout lasts 20 weeks.
Unemployment in North Carolina generally pays about half a person's salary, up to a cap of $350 a week. Cooper wants to increase that cap to $450 and tie future increases to inflation.
His budget would also boost the minimum weekly benefit from $15 to $100, and it would increase the number of weeks people get unemployment, though the total number of weeks would still be tied to the state's unemployment rate, going up as the economy worsens and more people are out of work.
Early in the pandemic there was some bipartisan support for increasing benefits in North Carolina, but it dissipated as the federal government funded temporary boosts to the payouts and the job market rebounded. North Carolina's unemployment rate now is about 3.8 percent, one of the lowest monthly rates the state has posted over the last 20 years.
Cooper's budget also includes a small tax cut for businesses, which pay into the unemployment trust fund to cover benefits. That rollback largely would be offset by a new "assessment" redirecting about $91 million a year from the trust fund to a new fund paying for job training programs around the state.
This assessment would go away if the unemployment trust fund drops below $1 billion, according to Cooper's proposal.
Berger said Thursday that he wasn't familiar enough with this proposal to comment on it. But Sen. Ralph Hise, a member of Republican leadership in the Senate, blasted the idea as a "tax we kind of hide."
The unemployment trust fund has just under $4 billion in it now, one of its highest points historically and one of the largest such funds in the country. But Republican lawmakers remember a decade ago, after The Great Recession decimated the trust fund and it owed $2.75 billion to the federal government.
In 2013 Republicans passed a series of reforms that lowered benefits and whittled away at that debt, repaying the federal government in 2015.
Hise, R-Mitchell, said lawmakers may look at benefit levels this year given the trust fund's size but that "personally, I would be much more supportive of just reducing the rate we're taxing businesses."
