Unemployment agency cutting jobs, hours

NEW YORK (Oct 12)  The Triad and Northwest North Carolina are waiting to see if they will be spared a significant impact from a cutback in unemployment assistance within an N.C. Commerce division.

Commerce spokesman Josh Ellis said Friday that to date, only a Davie County office served by the N.C. Division of Workforce Solutions has been chosen for reduced hours.

The division provides assistance to job seekers at 89 locations across the state, some of which are connected to JobLink sites within N.C. Division of Employment Security offices or community colleges.

The Raleigh News & Observer reported Friday the division had eliminated 353 temporary employees between May and Sept. 30 as part of a McCrory administration-directed restructuring of how Commerce provides unemployment benefits and job assistance. The job cuts were revealed this week during a legislative oversight committee meeting.

Gov. Pat McCrory , who was in Forsyth County on Friday for two events, said he could not comment of the job cuts because he had not read the article.

Ellis said he could not provide a breakdown for the number of temporary employees let go in the 14 counties that make up the Triad and Northwest North Carolina . The workers were hired in 2009 to help North Carolinians facing the brunt of a recession that began in late 2007. Their salaries were paid through federal and state funding.

The agency has had its funding reduced by 25 percent, or by about $25 million , since July 1 . According to the Raleigh newspaper, about $19.5 million had come from state unemployment taxes paid by employers.

The funding cut came as a result of a new state law -- effective July 1 -- that redirected that money toward paying down the state's $1.99 billion debt to the U.S. Labor Department for money borrowed to pay extended state jobless benefits.

The law also ended extended federal benefits for the jobless and reduced the weekly amount and number of weeks of unemployment insurance benefits.

Ellis said the workforce solutions division still has about 550 employees in the state.

It has reorganized 16 of 46 of its locations to date, with many of the offices reducing hours and/or reducing the number of days they are open each week. The agency plans to consolidate offices to community colleges and other sites where it makes logistical sense in order to reduce overhead costs

" Traffic flow was a consideration for those offices where temporary employees were let go or its operational hours were reduced," Ellis said. "The unemployment rates also were considered in the decisions."

He said the Workforce Solutions division plans to make up for having fewer employees through getting better at customer service and through the use of full-time employees whose primarily responsibilities are on federally funded training assistance programs.

" We are not leaving any county without these services," Ellis said.

The division also expects the redesigned NCWorks program will lessen the downsizing through its online services. Commerce officials have said the free website will streamline the job-search process, improve online security and reduce annual operational costs by more than $2 million .

Job seekers can search through job posts pulled from thousands of websites and receive alerts through email and text message. Employers can post jobs and gain access to real-time labor market information that will assist them in making competitive offers to recruit high-talented workers.

Commerce said Thursday that more than 1,600 businesses have registered on the www. ncworks.gov website since it debuted Aug. 5 .

" I am concerned that we are on a path that will lock in diminished resources and reduced services for the long-term future," said John Quinterno of South by North Strategies, a Chapel Hill firm specializing in economic and social policy. "The irony, of course, is that the demand for workforce services remains high due to the poor state of the North Carolina labor market.

" I think the bigger, overarching issue is that federal and state policymakers remain very ambivalent about workforce development. Everyone talks about the importance of workforce skills, yet the workforce development system often is overlooked, ignored and underfunded.

" Public leaders clearly don't put the money where their mouths are."

At least 65,000 North Carolinians, including about 12,000 in the Triad and Northwest N.C., lost their federal extended unemployment insurance benefits. Another 100,000 North Carolinians who would have become eligible for the benefits from July 1 until Dec. 31 also are affected, according to N.C. Justice Center data.

Legislators disqualified the state from federal extended benefits because they chose to alter North Carolina's unemployment insurance standards -- the maximum number of weeks dropped from 26 to 20 and the maximum weekly benefit shrank from $535 to $350 .

As a result, North Carolina is the only state to lose its federal extended benefits.

According to the N.C. Division of Employment Security , 22 percent of post- June 30 claimants will receive a reduced weekly benefit amount, including 17 percent who qualified for the maximum $530 .

Economists say it may take several months or up to a year to determine whether the reduced jobless benefits and the promise of a quicker reduction of the U.S. Labor debt will spur employers, particularly small businesses, to increase hiring.