South By North Strategies, Ltd.

CHAPEL HILL (January 5, 2010) –  November brought few positive changes in local employment conditions across North Carolina. Last month, 68 counties posted double-digit unemployment rates; of these, 33 had unemployment rates of at least 12 percent. These findings come from preliminary data released today by the Employment Security Commission.

“Job losses in North Carolina appear to have bottomed out in July, but few improvements have occurred since then,” says John Quinterno, a principal at South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Local labor markets are just drifting along the bottom of the recession.”

The statewide labor market struggled in November. Last month, employers shed 8,800 more positions than they added with the private sector accounting for 8,500 of the lost positions. Since the recession’s onset, North Carolina has lost, on net, 250,000 payroll jobs – a number equivalent to 6 percent of all the jobs that existed in December 2007. Last month, 10.7 percent of the labor force was unemployed (unadjusted rate).

In November, every part of the state experienced weak labor markets. Unemployment rates exceeded 10 percent in 68 counties, and in 33 counties, at least 12 percent of the labor force was jobless and actively seeking work. County unemployment rates ranged  from 6.3 percent in Orange County to 16.6 percent in Edgecombe County. Altogether, unemployment in the state’s non-metropolitan counties was higher than in its metropolitan ones — 11.8 percent versus 10.2 percent.

Unemployment also remained at elevated levels in all 14 of the state’s metropolitan areas. In November, six metros posted double-digit unemployment rates. The Hickory-Morganton-Lenoir area had the highest unemployment rate (14.4 percent) followed by Rocky Mount (13.6 percent). The lowest metro unemployment rate was 7.6 percent in Durham-Chapel Hill.

“Because of the lack of seasonal adjustments, monthly fluctuations in local unemployment rates must be interpreted cautiously, especially at this time of year,” warns Quinterno. “The better comparison is to contrast data from November 2009 to November 2008.”

Compared to one year ago, unemployment rates were higher in every North Carolina County and metro area. And compared to a year ago, 59 counties and 10 metro areas had smaller labor forces. Among metropolitan areas, Jacksonville posted the largest decline in the size of its labor force (-2.8 percent), followed by Hickory-Morganton-Lenoir (-1.2 percent) and Durham-Chapel Hill (-1 percent).

“When combined with other employment data, the November report shows a labor market that is going nowhere fast,” adds Quinterno. “Although the number of newly-unemployed individuals has fallen, the number of unemployed individuals who remain jobless has increased. This has led to a surge in the number of households experiencing financial hardships. For instance, some 578,000 North Carolina households received food stamps last month, a 23-percent increase from a year ago.”

In the long-term, private-sector job creation, especially in the state’s three major metro areas, is essential to any meaningful recovery. Yet that growth is not occurring. In November, the unemployment rate stood at 12.4 percent in Charlotte, 11.1 percent in the Piedmont Triad, and 8.4 percent in the Research Triangle. Compared to one year ago, all three major regions had unemployment rates that were at least 1.4 times greater and smaller labor forces.

“Right now there is a tremendous amount of idle labor in North Carolina,” says Quinterno. “Even though conditions have stabilized in recent months, what growth is occurring is insufficient to bring down joblessness and is extremely dependent upon federal recovery programs, which will begin to phase out later in 2010.”