(The Center Square) – With a total unemployment claim surge of 5,000 percent, the North Carolina agency that processes benefit applications has been overwhelmed, leaving 400,000 unemployed workers without compensation.
In the past 64 days, the North Carolina Department of Commerce's Division of Employment Security (DES) has paid out more than $2 billion to more than 500,000 unemployed workers, as of Monday. Still, nearly 900,000 people have filed for unemployment during that time.
Those claims are a result of the economic downturn caused by the response to the COVID-19 pandemic.
For some of those who received compensation, the process has been a “nightmare,” they told lawmakers Monday.
Anthony Martin from Peachland said his “personal nightmare” started April 17 after being furloughed for a month.
Martin went to DES’ website to fill out an unemployment application and later ran into an issue with the form. Martin said he made numerous calls and endured long wait times over several days before he could speak to a DES agent. He received his first payment May 12, but it was short by one week.
Martin still has to call to recertify his unemployment benefits every week.
“This should be the simplest part of the process,” Martin told members of the Senate Committee on Commerce and Insurance.
Martin was one of a dozen people who attended the meeting to voice their frustrations over the unemployment system.
Lockhart Taylor, assistant secretary of DES, admitted Monday the department was not ready for the economic whirlwind that resulted from the COVID-19 outbreak.
DES has paid out more unemployment benefits during the pandemic than the agency issued in total for the past six years, said Taylor, who has worked for the agency for 27 years.
“In that time, we have helped North Carolinians through major hurricanes and deep recessions,” he said. “None of those events compare to what we are experiencing right now.”
Taylor said the federal government funds the agency’s administrative budget. For the past five years, that funding has been cut by 20 percent.
A month before COVID-19 started affecting the state, Taylor told members of the Joint Legislative Oversight Committee on Unemployment Insurance that he was concerned about funding.
Sen. Andy Wells, the co-chairman of the oversight committee, said only the governor has the authority to tell a state agency how to operate.
“So an oversight committee is largely looking at facts, reporting details from what we hear from our districts and asking where we need to make legislative changes – those statute changes that are only made by the Legislature to facilitate the operation of that department,” said Wells, R-Catawba.
Gov. Roy Cooper’s office did not respond to requests for comment.
DES had 500 employers at the time of the oversight meeting.
The agency now has increased its payroll to 2,600 workers, who Taylor said have been working overtime to reduce the backlog.
DES also has upgraded its network services and other technology to support the influx of claims. Claims with the longest delays get priority.
The call center has gone from handling 6,000 calls a day to 42,000 calls a day. Taylor hopes they will be able to answer 65,000 calls a day by the end of the week.
Members of the commerce and insurance committee said they plan to look at legislative changes to prevent the agency from being overburdened again.