South By North Strategies, Ltd.

CHAPEL HILL (July 20, 2012) – Job growth in North Carolina turned positive in June, with the state gaining 16,900 more jobs than it lost. This marked the first month of positive job growth posted in the state since February. While the statewide unemployment rate remained at the lowest level recorded since early 2009, unemployment in North Carolina remained disturbingly high. These findings come from new data released by the Labor and Economic Analysis Division of the NC Department of Commerce.

“Over the first half of 2012, North Carolina gained 30,900 more payroll jobs than it lost,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “This slight gain unfortunately was insufficient to provide jobs for all those North Carolinians who wanted and needed work, and as a result, the state was home to an average of 451,094 unemployed persons in each month of 2012.”

In June, North Carolina employers added 16,900 more jobs than they cut (+0.4 percent). This was the second largest monthly gain recorded since January 2011. Last month, private-sector payrolls netted 11,700 positions (+0.4 percent), and public-sector employment levels expanded by 5,200 positions (+0.7 percent). Within the private sector, professional and business services gained the most jobs (+6,400, +1.2 percent), with 64.1 percent of that growth occurring in the administrative and waste management subsector. The education and health services sector netted 2,000 positions (+0.4 percent), followed by manufacturing (+1,500, +0.3 percent) and construction (+1,400, +0.8 percent). The other services sector shed the most jobs (-900, -0.6 percent), followed by leisure and hospitality services (-700, -0.2 percent).

A positive revision to the May payroll data found that the state lost 7,200 fewer jobs than first reported (-9,300 versus -16,500). With that revision, North Carolina now has, on net, 213,600 fewer payroll positions (-5.1 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 4,025 payroll jobs per month, leading to a cumulative gain of 112,700 positions (+2.9 percent).

“North Carolina recently had managed to close some of the job gap caused by the recent recession,” noted Quinterno. “Yet the progress has been too slow to both replace the jobs lost during the downturn and accommodate the state’s growing workforce. Compared to December 2007, North Carolina has fewer payroll jobs in every major private industry sector except for educational and health services and professional and business services.”

The household data for June provided further evidence of a struggling labor market. While the unemployment rate held constant at 9.4 percent, the number of employed North Carolinians fell by 7,909 persons (-0.2 percent) between May and June. Over the month, the size of the labor force fell by 5,312 individuals (-0.1 percent), while the number of unemployed Tar Heels increased by 2,597 (+0.6 percent). Compared to a year ago, however, the state’s labor force is larger, more people are employed, and fewer individuals are unemployed.”

While the unemployment rate of 9.4 percent is the lowest one recorded in the state since early 2009, unemployment remains widespread across North Carolina. Not only is the statewide unemployment rate 4.4 percentage points greater than it was 4.5 years ago, but the number of unemployed Tar Heels also is 91.9 percent higher. During the first half of 2012, an average of 451,094 North Carolinians were unemployed in any given month.

To place the scale of unemployment in context, consider how the number of unemployed North Carolinians in June (439,134) exceeded the total population of the City of Raleigh, which is the state’s second most populous municipality. Furthermore, the number of people added to the unemployment rolls since 2007 (+207,188) is roughly equivalent to the population of the City of Fayetteville, which is the state’s sixth most populous municipality.

Other troubling labor market indicators include a statewide unemployment rate that has exceeded 10 percent in 35 of the last 42 months, a labor force participation ratio that has fallen steadily during the year, and an employment-to-population ratio that remains near a 36-year low.

“North Carolina’s job market made little headway during the first half of 2012,” observed Quinterno. “While monthly job growth numbers have fluctuated widely, when the dust settled, the state had just 0.8 percent more jobs than it did last December. The job market is in no way, shape, or form mending itself.”