North Carolina's falling unemployment rate is not welcome news for every one: About 37,000 job-seekers will lose their unemployment benefits as a result, state officials said Monday.
The N.C. Employment Security Commission is ending its extended-benefits program - a federally funded payout that stretches as long as 20 weeks after job-seekers exhaust their first 79 weeks of unemployment benefits - because it no longer meets government requirements due to the slipping unemployment rate. The payments end April 16.
On one hand, the change marks a milestone on the road to recovery: The extended-benefits program was implemented in October 2008, amid a financial crisis that rocked the economy and cast thousands out of work. The state's unemployment rate climbed after that, hitting 11.4 percent, before falling in February to 9.7 percent.
On the other hand, ending the program worsens the burden for the state's growing number of long-term unemployed.
"It's absolutely nuts because there's no jobs out there," said Bob Carrick, 56, who lost his job as a construction superintendent two years ago and already has run out of unemployment benefits. "Especially for construction people like me. Absolutely no jobs."
North Carolina job-seekers are eligible for as long as 26 weeks of initial unemployment benefits, plus as long as 53 weeks of emergency unemployment compensation through a federal program set to expire in January. Qualified job-seekers can currently receive 20 weeks on top of that, for a maximum of 99 weeks - nearly two years - of government benefits.
The state has paid more than $750 million to 234,000 people through its extended-benefits program, ESC spokesman Larry Parker said. The federal government has paid those benefits in full since February 2009, he said.
But the state no longer qualified after a three-month average of its unemployment rate fell to about 9.8 percent in February from 11.4 percent for that three-month period the year before, Parker said.
State officials learned Friday that the program would end this month, and since have been fielding phone calls from worried job-seekers, he said.
"We are following federal guidelines here, and that is the reasoning" behind ending the benefits, Parker said. "We want to make sure we're really trying to inform people as best we can."
A provision in the 2009 federal stimulus act allowed federal funding for the 20 additional weeks of jobless benefits, and at least three dozen states, including North Carolina, decided to participate. Last month, Missouri officials voluntarily quit the program, citing efforts to stem government spending.
U.S. Department of Labor officials did not immediately provide data on how many other states still offer the program.
Despite a falling unemployment rate, the job situation in North Carolina and around the country remains dire. The 9.7 percent statewide rate remains well above its pre-recession level, often below 5 percent. And the North Carolina rate is still above the 8.8 percent national average, government data show.
Meanwhile, 6.1 million U.S. job-seekers were out of work for longer than six months in March, according to the U.S. Bureau of Labor Statistics. Those workers accounted for 46 percent of the total unemployed, up from 44 percent the month before.
"We have seen the unemployment rate fall in North Carolina over the past year or so, and on one hand that's a good thing, but on the other hand, that's driven by the contraction in the labor force," said John Quinterno of Chapel Hill research firm South by North Strategies Ltd. "... You'd like to say, hey, the unemployment rate is coming down, you don't need extended unemployment benefits. ... But people are out longer and longer. These benefits become, in some ways, even more important the longer you are out of work."
Many of the state's long-term unemployed have depleted their savings, he said. And many job-seekers complain that the longer they're out of work, the harder it is to find a new job.
"Anytime with unemployment, when you pull away that lifeline for a lot of folks, there are the negative effects on individual households that take advantage of those benefits," Quinterno said. "That is money that does come out of local communities."
Carrick, the laid-off construction worker, has exhausted his unemployment benefits and feels for those who stand to lose theirs as a result of the recent change, he said. Carrick, who lives in Stanfield, about 25 miles east of Charlotte, has applied for jobs all over the country without success.
Now, he's relying on temporary jobs and his wife's paychecks, he said.
"I'm frustrated to no end," Carrick said. "You can't find a job. You just can't find one."
The Associated Press contributed to this report.