The state of South Carolina will be paying back around a billion dollars borrowed from the federal government so that jobless workers receive their unemployment checks.
There was a period months ago when Governor Mark Sanford refused to sign the document that allowed the state to borrow the money from the federal government to cover those checks.
But Employment Security Commission Chairman McKinnley Washington says those loans have been very important, not only to South Carolina workers, but to everyone in the state, serving as a kind of stimulus fund that boosted the economy. Washington commented that South Carolina was particularly short on revenue for its own employment trust fund because many employees have left the state since the recession began. Trust fund revenue is paid in only by employers.
Washington says 20 states have received loans to keep checks going to their jobless workers. But he says some officials have been worried that the system may eventually go broke. “If that happens, the federal government may have to bail out the trust fund. Look at California. That is paying out 85 million dollars a day in unemployment funds. You can’t keep doing that unless someone finds some money from somewhere to put in the national trust fund.”
Washington says if you want to know just how bad the employment situation is these days, go to any Employment Security Service office. “People are standing in line everyday. We’re working our folks overtime on Saturdays, etc., to help people find jobs and pay out unemployment benefits. You’ve talking about people with Masters Degrees, PhDs, who’re out of work and can’t find work. A lot of the jobs are going South.”
Washington says if it weren’t for the work of the Employment Security Commission and a number of other agencies, South Carolina and other states would have seen conditions similar to those of the Great Depression. He says the extended benefits program has been saving people in tough times. “If that didn’t happen, people in this state would be starving. Food banks are running low. Without an extension of the benefits you would really have had a problem.”
The loss of manufacturing jobs has hit South Carolina especially hard. Washington says education is an inseparable part of the issue. He says some of the places with the worst unemployment are areas where many residents have less than a high school education. “A lot of those folks working in the factories, like in the upstate, barely finished elementary school. They came out of families who had worked for mills and they went to work for the mills. Now they’re 50 years old and it’s hard to train them for the new jobs coming in. Then you’ve got problems with unemployment as well as education–a double whammy.”
South Carolina’s unemployment rate was 12.1 percent in June. But analysts say the national economy, at least, may be making a turn for the better.