BLUEFIELD, W.Va (WVVA) - WVVA is helping to answer your questions about small business. Joining us every Wed. at 5 p.m. is John O'Neal, the Executive Director of the Development Authority of Mercer County,
WVVA: John, the first week of a new month often means release of economic data by various government agencies. What do you have for us today?
O'Neal: That's right. We received the latest employment numbers from Workforce West Virginia, as well as the January Revenue numbers from the Governor's Office.
The employment situation seemed to stabilize at the end of December. The unemployment rate was 6.3%, which was exactly the same as the previous month. The number of unemployed West Virginians seeking benefits remained at about 48,600.
We are seeing a slow and steady recovery from the restrictions imposed on business operations during the COVID pandemic. By comparison, during the most restrictive period of the pandemic, unemployment had jumped to 16%, with 124,000 West Virginians unemployed.
West Virginia small business has been resilient. Most employers have managed to adapt and keep their employees on the payroll. Including some that benefited from federal loans through the Paycheck Protection Program. It will be interesting to see if President Biden's proposal to extend and enhance unemployment benefits affect employment decisions.
WVVA: Revenue numbers for January were released from the Governor's Office. What do they tell us?
O'Neal: Gov. Jim Justice announced Monday that January tax collections were $46.6 million ahead of estimates. Following a strong January, West Virginia heads into the final five months of the fiscal year with year-to-date revenue collections at $173 million above projections.
The West Virginia Senate Finance Committee released data showing personal income tax collections were $26.5 million better than expected in January. Severance taxes were $8.2 million above estimates while consumer sales tax collections were on target.
Governor Justice said the state is in a strong position when it comes to cash flow. It appears that the state has made prudent financial decisions with CARES Act money, including spending a portion to replenish the state's unemployment compensation fund.
WVVA: That is great news! Why is it important that the Governor used some CARES Act funds to subsidize the unemployment compensation fund?
O'Neal: There continues to be many worthy demands on the Governor for disbursing funds from the federal CARES Act. By dedicating a portion to the unemployment compensation fund, he has kept the fund solvent, preventing a massive rate increase to small business owners. This makes it easier for small business owners to stay open, and keep their employees on the payroll.
The revenue surplus will likely play a key role in the upcoming 60-day legislative session that begins Feb. 10.
Governor Justice will give his State of the State Address that night. Next week we will begin a new series on legislation that may affect business, economic development, and employment in our state.