Last weekend, John Quinterno of South by North Strategies was a guest on the syndicated radio program News & Views with Chris Fitzsimon. Quinterno and Fitzsimon discussed trends in North Carolina’s labor market during the first half of 2013 and related policy choices taken by the state’s General Assembly.
Click below to listen to the segment (8.5 minutes).
CHAPEL HILL, NC (July 30, 2013) – Between June 2012 and June 2013, unemployment rates fell in 85 of North Carolina’s 100 countries and in 13 of the state’s 14 metropolitan areas. Over that period, however, the size of the labor force decreased in 78 counties and in 9 metro areas. These findings come from new estimates prepared by the Labor and Economic Analysis Division of the North Carolina Department of Commerce.
“Local unemployment rates fell throughout North Carolina over the year,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Unemployment rates nevertheless remained elevated, with 44 counties and 3 metro areas posting unemployment rates of at least 10 percent. In June 2008, in contrast, three counties and no metro areas logged unemployment rates of at least 10 percent.”
Compared to December 2007, which is when the national economy fell into recession, North Carolina now has 2.9 percent fewer jobs (-119,600) and has seen its unadjusted unemployment rate climb to 9.3 percent from 4.7 percent. In June, the state gained 5,700 more jobs than it added (+0.1 percent). Since bottoming out in February 2010, the state’s labor market has netted some 5,205 jobs per month, resulting in a cumulative gain of 208,200 positions (+5.4 percent).
Between May 2013 and June 2013, local unemployment rates increased in 81 of the state’s 100 counties. Individual county rates ranged from 5.8 percent in Currituck County to 16.2 percent in Scotland County. Overall, 44 counties posted unemployment rates greater than or equal to 10 percent, and 51 counties posted rates between 7 and 9.9 percent.
“Non-metropolitan labor markets continue to struggle relative to metropolitan ones,” noted Quinterno. “In June, 10.3 percent of the non-metro labor force was unemployed, compared to 8.9 percent of the metro labor force. Compared to December 2007, the non-metro labor force now has 4.9 percent fewer employed persons, while the number of unemployed individuals is 85.9 percent larger.”
Over the month, unemployment rates rose in all 14 metro areas. Rocky Mount had the highest unemployment rate (13.3 percent), followed by Hickory-Morganton-Lenoir (10.5 percent) and Fayetteville (10.4 percent). Asheville had the lowest unemployment rate (7.1 percent), followed by Durham-Chapel Hill (7.3 percent) and Raleigh-Cary (7.5 percent).
Compared to June 2012, unemployment rates in June 2013 were lower in 85 counties and 13 metro areas. Over the year, however, labor force sizes decreased in 78 counties and in 9 metros. Among metros, Rocky Mount’s labor force contracted at the greatest rate (-2.1 percent), followed by that of Hickory-Morganton-Lenoir (-1.6 percent). With those changes, metro areas now are home to 71.7 percent of the state’s labor force, with 50.2 percent of the labor force residing in the Triangle, Triad, and Charlotte metros.
In the long term, improvements in overall labor market conditions depend on growth in the Charlotte, Research Triangle, and Piedmont Triad regions. Yet growth in these metros remains muted. Collectively, employment in those three metro regions has risen by 2.9 percent since December 2007, and the combined June unemployment rate in the three regions equaled 8.6 percent. That was down from the 9.2 percent rate recorded one year ago yet was well above the 5.8 percent rate recorded in June 2008. Of the three broad regions, the Research Triangle had the lowest June unemployment rate (7.6 percent), followed by Charlotte and the Piedmont Triad (both 9.4 percent).
“Almost 3.5 years into a recovery in North Carolina’s labor market, unemployment rates remain elevated across the state,” said Quinterno. “The first half of 2013 was the most disappointing one for job growth since the onset of the recovery, and if current trends continue, 2013 could prove to be the worst year for labor markets in North Carolina since the recovery began.”
Jared Bernstein weighs in regarding potential solutions to the problems of inequality and diminished economic mobility.
In my writing, I’ve identified this as the uniquely American, highly toxic combination of wealth concentration interacting with money in politics to create a vicious cycle that promotes higher inequality, less mobility, and — clearly evident in the current context — dysfunctional politics that can’t begin to do anything about either the macroeconomy or the inequality problem except make them worse.
…
In this regard, solutions must be both political, structural (for example, campaign finance reform) and much more demand side than strictly supply side (education being the latter — and to be clear, I agree that’s a critical part of the solution). This is where the full employment policies I’m always going on about fit in, along with greater union power, higher minimum wages, financial market regulation, progressive taxation, and taking aim at the persistent trade deficit that has been sapping demand from our manufacturers for decades.
…
That’s a huge, ambitious agenda, one that goes so far beyond the realm of the possible that it may seem curious to even raise it. But the fact is that anything useful goes beyond what’s possible right now, and I just don’t see the point of bringing a squirt gun to a forest fire. At the very least, I’d like my fellow travelers to envision the full scope of what we’re up against.
An opinion piece in The New York Times explains why having legal immigration status “doesn’t end poverty.”
“We see employers in a number of industries act as if there is a third-class labor market that is paid below the minimum wage and are made to suffer all manner of violations of labor law,” said Nik Theodore, an associate professor in urban planning and policy at the University of Illinois, Chicago. “For many employers it is a calculated risk that they are willing to take. They trust that their employees aren’t going to report them and that nobody from the government is actually going to come check. When you have workers in desperate need of work, they are going to be willing to do a lot of things.”
…
Over all, unreported income amounts to roughly $2 trillion annually, but cash wages make up only a portion of that estimate, according to Edgar L. Feige, an emeritus professor of economics at the University of Wisconsin, Madison, who has spent decades examining underground and cash economies, in part by using information on how much cash is in circulation at any given time. There is no way of knowing how many workers are earning their salaries in cash, Professor Feige said.
CHAPEL HILL, NC (July 19, 2013) – June marked the end to a disappointing six months for North Carolina’s labor market. Over the first half of 2013, employers added just 16,100 more jobs than they cut (+0.4 percent). That change was the worst first-half figure posted so far during the economic recovery. Moreover, the size of the state’s labor force has fallen steadily throughout the year, as has the number of employed persons.
These findings come from new data from the Labor and Economic Analysis Division of the NC Department of Commerce.
“The first half of 2013 was the most disappointing one for job growth in North Carolina since the onset of the recovery,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “While 2013 began on a positive note due to hiring in the private sector, virtually no net job growth occurred during the year’s second quarter. Since March, the state has lost 100 more jobs than it has gained.”
In June, North Carolina employers added 5,700 more jobs than they cut (+0.1 percent). That monthly change was the first positive one logged since February. Last month, private-sector payrolls netted 6,300 positions (+ 0.2 percent), while public-sector payrolls shed 600 jobs (- 0.1 percent). Within the private sector, the professional and business services sector netted the most jobs (+3,700, +0.7 percent), with 97.3 percent of the gain originating in the administrative and waste management services subsector. The construction industry added, on net, 1,800 positions (+1.1 percent), followed by the trade, transportation, and utilities sector (+1,600, +0.2 percent), with all of the gains occurring in the retail trade subsector. Meanwhile, the other services sector shed the most positions (-1,600, -1.1 percent), followed by the education and health services sector (-600, -0.1 percent) and the leisure and hospitality and manufacturing sectors (both -300, -0.1 percent).
A revision to the May payroll data found that the state lost somewhat fewer jobs than first estimated (-5,100 versus -5,900). With that revision, North Carolina now has, on net, 119,600 fewer payroll positions (-2.9 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 5,200 payroll jobs per month, resulting in a cumulative gain of 208,200 positions (+5.4 percent).
“North Carolina experienced very little net payroll growth during the first half of 2013,” noted Quinterno. “The net gain of 16,100 jobs equaled just 35.6 percent of the gain recorded during the first half of 2012. For North Carolina to net as many jobs in 2013 as it did in 2012, the state would need to net an average of 12,300 jobs per month for the rest of the year. The last time the state averaged comparable growth during the second half of a year was in 2006.”
The household data for May also pointed to the existence of a sputtering labor market. Since the start of 2013, North Carolina has experienced a steady decline in the size of the labor force, as well as the number of employed persons. The size of the labor force has returned to a level last seen in April 2012, and the number of employed persons is at the lowest level posted since October 2012. While both the number of unemployed North Carolinians and the statewide unemployment rate have fallen throughout 2013, the improvements are largely attributable to people leaving the labor market rather than finding new positions.
Another alarming development experienced during the first half of 2013 was a steadily slide in two major measures of labor utilization. The labor force participation rate has fallen by 1.1 percentage points since last December, while the employment to population ratio has dropped by 0.7 percentage points. Both indicators are trending back toward their recessionary lows.
“The first half of 2013 proved disappointing for North Carolina’s labor market,” observed Quinterno. “Job growth ground to a halt, especially in the second quarter, and sizable numbers of people left the labor market altogether. If the current pace of job growth continues during the year’s second half, 2013 could prove to be the worst year of job growth in North Carolina since the onset of the economic recovery.”
Email Sign-Up | 
RSS Feed
