State’s unemployment rate hits 25-year high
Governor balks at loan for jobless benefits until agency agrees to changes
By Tim Smith • CAPITAL BUREAU • December 20, 2008
COLUMBIA — South Carolina’s unemployment rate rose to 8.4 percent in November, keeping the jobless rate at a 25-year high as the governor continued his demand that a state agency agree to changes before he signs a federal loan extending unemployment benefits.
Joel Sawyer, a spokesman for Gov. Mark Sanford, said the governor wants the Employment Security Commission, the agency administering unemployment benefits, to agree to an independent audit and to better cooperate with the Department of Commerce in sharing data.
“If they do those two things, then we will request the loan,” he said. “We view the ball very much being in their court right now.”
He also said the governor may still agree to the loan but wants to use the opportunity to seek change at the ESC.
The agency appeared unmoved by Sanford’s request. “The unemployment data gathered by our agency has been repeatedly verified by the Bureau of Labor Statistics, and our Unemployment Insurance program has regularly been honored by the (U.S.) Department of Labor for its timeliness and efficiency,” Rodney Welch, a spokesman for ESC, said in a statement. “We stand on our record of service.”
South Carolina has about two weeks of funding left in the state’s unemployment trust fund. ESC’s director has said that without the governor’s signature for the loan, the state won’t have benefits to pay at the first of the year. More than 60,000 people now are receiving unemployment benefits in the state each week, according to the ESC.
Some lawmakers agreed with Sanford’s concerns and others disagreed. But those interviewed Friday said it was wrong for the governor to use unemployment benefits as leverage to try to change the agency.
“I think it is a mistake to threaten the unemployment benefits of people around the state who are pretty stressed out to try and force the Employment Security Commission to try and do what he wants them to do,” House Speaker Bobby Harrell said.
Harrell said an audit would be fine and that he has told the director of the Commerce Department that he would help him in his quest to get better information sharing from ESC.
But he said the governor might have had better luck had he talked to legislative leaders about his concerns instead of threatening to withhold his support of the loan request.
“This is just another example of instead of calling legislative leadership and talking about how we need to solve a problem, we’re all hearing about it from a reporter,” he said.
November’s unemployment rate is 0.5 points above the October revised rate of 7.9 percent and the highest rate for the state since September 1983, according to the South Carolina Employment Security Commission.
The state’s rate is tied with California as the nation’s third highest.
State economists have predicted that the state’s unemployment rate could reach 14 percent next year.
Greenville County’s rate jumped from 6.5 to 6.9 percent, slightly above the national average. The highest rate in the state was Allendale County, with 17.8 percent.
The state’s number of employed remained about unchanged, according to ESC officials, while the number of those without jobs rose by 11,500.
“This rise in joblessness was expected as layoffs and business closures continue to mount in the wake of the national economic crisis,” said ESC Executive Director Roosevelt T. Halley.
Rep. Bill Sandifer, a Seneca Republican who chairs the House Labor, Commerce and Industry Committee, said he wouldn’t oppose a Legislative Audit Council examination of the ESC. But he said he is concerned first with helping the state’s unemployed.
Sen. John Land, leader of the Senate’s Democrats, called the governor’s demands a “shameful game of Russian roulette.” He said it is his understanding that the information sought by Commerce “is available to them.”
Otis Rawl, executive director for the South Carolina Chamber of Commerce, said the business community wants to see the governor and ESC “work those things out.”
He said businesses want to avoid a tax increase for unemployment benefits and the state needs to request interim funding from the federal government. The question, he said, is how much, especially given the projection of the state’s jobless ranks swelling in coming months.
“The issue is what are we going to do in the long term,” he said. “We’ve got some things going on in our economy we’ve got to turn around. We’ve got to start looking at being pro-economic development, recruiting new industry and providing an environment that allows us to create jobs in South Carolina.”
Sen. Larry Martin, a Pickens Republican, said he finds Sanford’s use of the federal loan to demand change “wholly unacceptable.” He said taxes will go up for businesses if the loan isn’t made.
The state’s jobless, he said, “could care less” about changes at ESC if their benefits are interrupted.
“If that is cut off, who have we helped?” he asked.