The unemployment rate in North Carolina continues to decrease. Critics argue about the cause of such a drop, but yet another study points to a strong relationship between the drop in unemployment benefits and the rise in employment. This Forbes articles highlights a study in the National Bureau of Economic Research conducted by Haedorn, Manovskii, and Mitman.
Not only has the national unemployment rate dropped recently, but the ratio of job seekers to openings fell from seven to one to two to one this past November. Following the recession, unemployment benefits rose to an average of 53 weeks. Following congressional inaction on EUC benefits, the average fell to 25 weeks.
Lets look at the findings. After looking at one Virginia County and one Maryland county side by side, they found that employment growth was larger in places where bigger declines in benefits occurred. Its estimated that around 1.8 million new jobs were filled or created due to the change in unemployment benefits-a slim majority being filled by folks not in the labor force.
While liberals charged such changes as "cruel" like President Obama did while offering no new ideas or solutions, the results show a strong correlation between the drop in unemployment benefits and a productive workforce.