Initial state jobless claims drop 20% in N.C. Initial state unemployment claims drop 20% in North Carolina

North Carolina had a 20% drop in initial unemployment-insurance claims last week, which followed the first weekly increase since two key federal pandemic relief programs expired Sept. 4.

With no COVID-19 pandemic UI programs available currently for North Carolinians, the U.S. Labor Department reported Thursday the state had 3,576 new regular state claims for the week that ended Oct. 16.

A revised 4,473 claims were listed for the week that ended Oct. 2, along with 3,687 for the week that ended Oct. 2, 3,557 for the week that ended Sept. 25 and 7,110 claims for the week that ended Sept. 18.

The state was 18th in the nation in the number of unemployment filings, down two spots from last week.

North Carolinians determined currently to be eligible for regular state UI benefits can draw up to 13 weeks - the lowest level offered by any state - that provide a maximum weekly benefit of $350, although the average claimant receives about $235.

By comparison, the state's highest weekly total for claims related to the pandemic was 172,745 for the week that ended March 28, 2020.

As of Sept. 5, nearly 178,000 jobless North Carolinians no longer received the $300 in weekly federal benefits.

U.S. Labor listed 27,426 North Carolinians drawing regular state benefits as of Oct. 9, down from 30,210 from the previous week.

Once the 13 regular state benefit weeks run out, N.C. claimants have to wait another 39 weeks before they can file again.

The $300 per week extended federal UI payments kept some potential employees on the sidelines since they made more from not working than in a minimum- to low-wage job.

Economists say the September state and county-level jobless reports should provide insight into whether the expiration of the two federal programs will produce an increase in hiring and individuals re-entering the workforce.

"One thing to remember is that although all of the enhanced federal benefits expired, that expiration is for benefit weeks starting after the week ending on Sept. 4," said John Quinterno, principal with South by North Strategies Ltd., a Chapel Hill research company specializing in economic and social policy. "People with eligible claims for prior weeks still are eligible for benefits for those weeks.

"That might include people who lost a job at the very end of August, or those with prior claims that are pending or under administrative review for some reason."

The details

The extended federal programs included: pandemic emergency unemployment compensation (PEUC); pandemic unemployment assistance (PUA); federal pandemic unemployment compensation (FPUC); and mixed-earners unemployment compensation (MEUC).

As of Sept. 7, North Carolina had received $13.27 billion, with regular state benefits of $2.03 billion, while federal and state extended benefits are at $11.24 billion.

By far the biggest factor in UI benefit payments has been the FPUC program at $7.31 billion. That represents about 55% of all UI benefit payments.

Also as of Sept. 7, there have been 1.54 million individual claims filed in North Carolina during the pandemic, with DES determining that just more than 1 million claimants have been eligible for state or federal UI benefits.

Federal guidelines require a separate application for each unemployment program.

Overall, there had been at least 3.83 million state and federal claims filed as of Sept. 7.

Nationally

National UI claims dropped by 6,000 to 290,000 for the week that ended Oct. 16.

The Oct. 16 count represents the lowest weekly claims count for the pandemic.

There were 3.28 million individuals nationwide with an active claim as of Oct. 2, down 9.4% from Sept. 25 and down 70.8% from 11.25 million as of Sept. 4.

About 2.43 million workers drew state benefits and 849,516 received federal benefits, mostly extended benefits that have ended for North Carolinians.

Mark Hamrick, chief economist analyst for Bankrate.com, said Thursday that continuing claims, "a gauge of the total number of individuals receiving benefits through traditional state programs, also reached a post-COVID low."

"All this signals that most employers don't need or want to shed workers. It is quite the contrary with job openings remarkably high," Hamrick. "The headwinds of supply chain congestion and high inflation threaten to make further significant job market improvement hard to come by."

Hamrick cautioned that lower household income could signal lower holiday shopping this season, "reflecting the threat to their personal finances from inflation."

"Yet, retail sales have recently surprised to the upside, even amid supply constraints. A great, unanswerable question for the coming year or so is whether inflation relaxes its grip on the economy, consumers, and businesses," Hamrick said. "At the very least, it is a tremendous source of uncertainty for the outlook over the intermediate and longer-terms."

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