Sales
tax collections fall
9% below last year's total
October sales tax collections fell 9.3 percent below
last year's levels, according to State Budget Officer
David McCoy, who said the decline is a sign that the
state’s fiscal second quarter may be as bad as the
first. McCoy said North Carolina collected $269.6
million in sales taxes in October, compared to $297.2
million in the same month last year. For the fiscal
year to date, sales tax collections are down 1.9
percent, at $1.149 billion compared to $1.172 billion
(see chart below).
The sales tax drop follows a 3 percent decline in
overall state revenue for the first quarter against
budget projections, or $155 million less than
forecast. Overall collections, however, are 2 percent
higher than actual collections at this point last
fiscal year. State economists had projected 2 percent
growth during that quarter.
Among the few bright spots in the budget are rising
collections of corporate income taxes, which have
amounted to $45.2 million in the fiscal year to date
compared to $9.6 million in last year’s period.
North Carolina isn’t alone in continuing to see weak
revenues. Analysts at the National Conference of State
Legislatures said 44 states are reporting revenue
levels below what they projected. At least 28 states
are considering or have implemented budget cuts.
ESC
delays seeking higher
unemployment insurance taxes
The
Employment Security Commission voted not to ask the
General Assembly to increase unemployment insurance
now but warned that rates could escalate – even
double -- in a few months unless the economy
improves.
At a Nov. 29 meeting, commission members
noted that the state has paid out $830 million in
unemployment benefits to laid-off workers over the
past year while collecting just $332 million in
unemployment insurance taxes from employers.
That has caused a sharp drop in the state’s
Unemployment Insurance Trust Fund, which has faller to
about $762 million. A level below $800 million in the
fund is considered worrisome.
The state paid out a record $95.3 million in jobless
benefits in October. Commission members said they
wanted to delay asking for higher unemployment
insurance taxes on the hope that an anticipated
federal economic stimulus package would quickly revive
the economy. |
State
jobless rate surges
to 5.5%, highest since 1993
North
Carolina’s seasonally adjusted unemployment rate
increased in October to 5.5 percent, up from 5.2
percent in September, according to the state’s
Employment Security Commission (ESC). Layoffs in
service industry employment, including air
transportation and hotels, mainly fueled the increase
in unemployment, according to ESC Acting Chairman
Thomas S. Whitaker. The last time the state’s
jobless rate was this high was in January 1993. One
year ago the N.C. unemployment rate was 3.8 percent.
Unemployment rates rose in 86 N.C. counties in
October, fell in 10 counties and were unchanged in the
remaining four. Robeson County had the state’s
highest unemployment rate in October, at 12.5 percent.
Watauga County had the lowest, at 1.6 percent. The
county rates in this release are not seasonally
adjusted.
The state paid out more than $95 million in
unemployment insurance benefits in October, the
highest amount ever paid in one month, up from the
previous high of $88 million in July. This brings the
total unemployment insurance benefits paid for the
2001 calendar year to $740.6 million, leaving a Trust
Fund balance of $761.8 million.
The U.S. unemployment rate increased to 5.4 percent in
October, up from 4.9 percent in September. North
Carolina’s rate has been higher than the national
rate since February 2001.
Manufacturers in North Carolina cut 2,200 jobs in
October and a total of 48,900, or 6.3 percent of all
manufacturing jobs in the state, in the past year.
Losses in manufacturing were in textiles, down
15,300 jobs; furniture and fixtures, down 6,100; and
electronic equipment, down 5,800. However, overall
employment in the state continues growing. In the year
to date, employment has grown by 4,200 jobs, according
to ESC figures.
The ESC continues to put people to work as quickly as
possible. During October 2001, ESC listed 83,743 job
openings and 10,862 placements. The average time a
North Carolina worker collects unemployment benefits
before returning to work is just 9.3 weeks, compared
to a national average of 13.7 weeks. |
