To its credit, the General Assembly meets in special session today. Its agenda is to do what the state should have done months ago to secure additional unemployment benefits for thousands of South Carolinians. These are extended benefits fully funded by the federal government, which come at no cost to the state.
Had the state acted in February, South Carolinians who have been laid off would have been eligible for seven more weeks of benefits starting this past March, and would not have lost access to 13 weeks of benefits last week, for a total of 20 weeks, through the end of the year.
Without passage of legislation, more than 30,000 South Carolinians could miss out on benefits that they are entitled to under the American Recovery and Reinvestment Act, better known as the stimulus act.
My staff and I discovered this omission a month ago while gathering facts on the Unemployment Compensation Extension Act. We reported the discrepancy in a press release because we found it hard to believe. South Carolina has borne the brunt of the worst recession since the Great Depression. How could we pass up an opportunity like this?
My staff put that question to the governor's office and the Employment Security Commission, and found both unaware of the situation. We inquired further, and found that the U.S. Department of Labor had been notifying the Employment Security Commission of laws that should be passed at the state level as early as February of this year, and throughout the spring.
All states are required by law to adopt a trigger for extended unemployment insurance benefits, based on the insured unemployment rate. The extended benefits are typically funded by a 50/50 state-federal match. The threshold for benefits is an insured unemployment rate of 5 percent.
The problem with this measure is that once people exhaust their benefits, they are no longer counted as unemployed - even if they still don't have a job. The number of unemployed people who no longer are being counted has reached such a high level in South Carolina that our insured unemployment rate has dropped below 5 percent, and so extended benefits were cut off last week.
Fortunately, there is an alternative. States have the option of enacting an additional trigger for extended benefits, based on the total unemployment rate. Since the federal government picks up the tab under the Recovery Act, states with high unemployment have every reason to enact a total unemployment rate trigger. The threshold for 20 weeks of extended benefits under this trigger is 8 percent. In South Carolina, total unemployment is 11.6 percent, so those out of work in our state qualify for 20 weeks of extended benefits.
Twenty-one states - every state that could benefit except South Carolina and Mississippi - adopted the total unemployment rate trigger after passage of the Recovery Act, putting themselves in position to take advantage of full federal funding.
For many who have lost their jobs, unemployment insurance is not just a benefit, but the most important source of assistance. It was launched when President Roosevelt signed the Social Security Act on Aug. 14, 1935, and it has stood the test of time.
In helping the unemployed, the benefit also helps the economy. Every dollar spent on unemployment insurance benefits generates $1.64 in economic activity.
The program is especially important to South Carolina, which has suffered through 14 straight months of unemployment above 7 percent. In September, the state posted an unemployment rate of 11.6 percent, with five counties reporting unemployment above 20 percent.
Some 250,000 South Carolinians are out of work and among the hardest hit by this recession. All they ask is the opportunity to earn their way in our economy. The least we can do is to hold up the safety net of available benefits. The U.S. Department of Labor has gone the second mile to aid the state in correcting this discrepancy. The governor and General Assembly need to patch this gap in the safety net and help thousands of worthy South Carolinians.