Economic Crisis Hits Some Harder Than Others in North Carolina

Economic Crisis Hits Some Harder Than Others in North Carolina

Report outlines policy changes that could aid recovery


Assisting families and communities recover is about more than helping North Carolinians find jobs because economic security requires much more than income. Achieving a more stable economic recovery for our state means connecting families to assets such as affordable housing, educational opportunities and savings accounts. The North Carolina Asset Alliance's new report, "A Prosperity Grid for North Carolina -Connecting Households and Communities to Economic Opportunity ," outlines how the state must invest in programs that can stimulate the economy in the short term and stabilize it for tomorrow. By enacting smart policies and connecting low- and moderate-income communities to economic opportunity, North Carolina could emerge with a stronger economy than it has today.  

The challenge is dramatic as many North Carolinians are not connected to the tools that build assets. One-in-10 North Carolina households have zero or negative net worth, only 26 percent of adults 25 years or older have completed college and more than 3.1 million households spend more than 30 percent of their monthly income on housing costs. Meanwhile, more than 50,000 families or individuals lost their homes in 2008 and households of color own just 7 cents for every $1 owned by white households. 
 
Looking ahead for North Carolina means building a framework to help individuals and families accumulate assets while encouraging legislators to make smart investments that can generate ongoing returns and protect those most affected by the current crisis. A balanced approach to the budget will be necessary and legislators must consider options to raise revenue, leverage federal dollars and make the smartest investments. The report outlines three key recommendations:
 

  1. Strengthen Connections to Work and Income – Legislation must support households in economic distress and allow them to productively seek re-employment. For example, passage of House Bill 877 would broaden access to Unemployment Insurance.
  2. Generate Savings and Assets – Increased investments in the Housing Trust Fund and child care subsidies will stimulate industry, generate jobs, build a local tax base and help families and individuals build long-term assets that they can pass on from generation to generation.  
  3. Protect Assets – By creating a system that protects families and individuals from scams, hard-earned assets are protected. Passing Senate Bill 1050 would prohibit home foreclosure rescue scams.

If we enact smart legislation and invest in supports already in place, North Carolina will be well positioned for the future. To read the full report – "A Prosperity Grid for North Carolina," please visit www.ncassets.org.
 
Advocates React to the Report
 
"The report's findings should be alarming to North Carolinians concerned about our economic recovery and long-term economic success. Nearly one in five households do not have sufficient assets to live above the federal poverty line with a loss of earned income. Average net worth in North Carolina is well below the national average. And many households do not have access to the tools that build assets – savings accounts, retirement plans and college education."
Alexandra Sirota, Action for Children North Carolina
 
"In forming the North Carolina Assets Alliance, we recognized that many organizations worked on different policies and programs that contributed to widely shared prosperity but that we also needed a connecting framework that tied our efforts together. That connecting framework is assets because having a savings account, a good education, a home, retirement savings or a small business helps individuals and families weather difficult times, plan for the future and pass on resources to the next generation. In short, assets matter for the well-being of North Carolina's children and their educational aspirations, for community and household stability, for the state's economic development, and for increasing equity and generational mobility."
Lucy Gorham, MDC, Inc.
 
"During this period of North Carolina's greatest housing crisis, which continues to worsen for low- and moderate-income households, we are deeply concerned about the decision to reduce funding to the N.C. Housing Trust Fund, which both stimulates the economy and provides critical quality housing opportunities for those most in need. Now is the time when we can make investments that bring immediate and long-term rewards for our citizens and out state. Quality affordable homes close to employment and services are an important asset in terms of improved public health, less traffic congestion, increased household savings and wealth-building and community well-being. Reducing these investments will make our immediate economic situation more difficult and prevent increased improvement in the future."
Chris Estes, N.C. Housing Coalition

"North Carolina has one of the highest unemployment rates in the country, with some parts of the state over 15 percent. It only makes sense for the General Assembly to stregthen the unemployment insurance system so as to take full advantage of the federal dollars available and to ensure families struggling with unemployment have a cushion to help them through these difficult times. In addition, unemployment benefits also help local economies during these hard times because families will spend those benefits at their communities' businesses."
Bill Rowe, N.C. Justice Center
 
"Investing in energy efficiency programs, run by an entity that is separate from energy companies, is critical to the future affordability of energy and the protection of our environment. Otherwise, North Carolinians will bear the tremendous economic and environmental costs of building new power plants. In addition, energy efficiency programs will create thousands of green jobs in North Carolina."
Al Ripley, N.C. Justice Center