NC Budget and Tax Center

Despite overall state job gains, small towns lag behind

Crossposted from Prosperity Watch.

In recent months, North Carolinians have continued to hear good news about the state’s labor market.  The state’s unemployment rate for February dropped below 10% for the first time since 2009, while local unemployment rates—which are not seasonally adjusted—have dropped across 81 North Carolina’s counties since February 2011.

Despite these positive trends, however, it is clear that the state’s job gains are not occurring evenly across the state, and that some regions are experiencing a greater share of the state’s job creation than other regions.

In fact, the lion’s share of North Carolina’s overall employment gains has occurred in the state’s 14 metropolitan areas, rather than in other, more rural regions.  Since February 2011, 97% of the 84,000 jobs created in North Carolina have accrued to the state’s large cities.  And over 56% these jobs were created in just three metro areas—Charlotte, Raleigh-Cary, and Greensboro-High Point—the most highly populated regions in the state.

By comparison, the combined employment gains of the state’s 26 micropolitan regions—essentially the state’s small towns with populations between 10,000 and 50,000 people—only account for 3.3% of the state’s total employment gains since February 2011.  As a result, the state’s large cities are clearly outpacing its small towns in terms of job creation.

Perhaps the single most important factor contributing to these differences in economic performance involves the different trends in the labor forces of these two types of regions.  As defined by the U.S. Bureau of Labor Statistics, the labor force includes those workers between the ages of 16 and 65 who are employed or who are looking for work—they are, in effect, the pool of workers available for a region’s businesses.  In the state’s large cities, the labor force grew by 1.7% in the last year—which accounts for the entirety of North Carolina’s growth in workforce—while small- and medium-sized towns saw an 8.6% decline in their labor force.

Mirroring the long-term trend in population movement from rural to urban areas, this suggests that workers are leaving small and mid-sized towns for brighter employment prospects in the state’s large metro areas.

 

One Comment

  1. Doug

    April 13, 2012 at 8:35 am

    Unfortunately , many small towns in NC and the nation will disappear in the future once the current group of seniors pass away because there are no jobs. I was in Detroit recently, and was totally amazed with such a bleak setting in a once vibrant city, almost third world-like. The unions have done a real job on Detroit which is totally bankrupt, and now dependent on the state. I could only chuckle when I heard that it took 65 union employees to do the payroll for the Detroit police department, and they were considering a strike. I’ve never understood the union mentality.