NC Budget and Tax Center

Uneven recovery demands targeted response but state decisions move in opposite direction

Disparities in economic opportunity for North Carolina’s workers have persisted for generations, including the last few decades when the state’s economy transformed away from manufacturing employment and toward service employment. These disparities have grown since the Great Recession, according to a newly released State of Working North Carolina report. Although the downturn’s economic pain was pervasive, it was not spread evenly throughout the state. The new report shows that some communities and regions were harder hit than others and continue to struggle with high unemployment and few opportunities for growth.

There are multiple storylines to this “tale of two economies” reality. One is the rural and urban divide. Rural North Carolina is continuing to lose jobs, while cities and suburbs have seen employment growth. Another reality is the race and ethnicity divide among whites and communities of color. This gap has always existed but grew after the recession when communities of color—African Americans in particular—bore the brunt of job losses. There is also the long-standing gender gap that narrowed during the downturn but widened post-recovery as men have been quicker to regain lost ground.

There is a clear need to target policies to the hardest-hit communities in order to improve equity of access and opportunity. Yet, the new state budget and other state-level policy decisions—such as the elimination of the Earned Income Tax Credit—do more harm than good in delivering targeted relief.

For example, the budget shifts economic development investments away from low-income, distressed populations and communities and toward more broad-based efforts focused on attracting more businesses to NC. Elimination of funding for the nonprofits that help reduce poverty, create jobs, and strengthen small businesses—such as the Institute of Minority Economic development and its women’s business center—move rural communities, African Americans, and women in the wrong direction. The budget also reduces funding for low-wealth school districts that are essential to developing our future workforce. These cuts come on top of federal budget cuts to education resulting from the sequester, which is taking a harder toll on low-income areas.

Seeking to reverse disparities is in the best interest of all North Carolinians because everyone is impacted when economic hardship grows. As such, it is critical that state investments foster the well-being of residents in opportunity-deprived areas by supporting access to a high-quality education, living-wage jobs, and small-business development. Doing so will strengthen the opportunity structure—especially in disadvantaged areas—and help build a more inclusive economy that will support all workers and the recovery.

7 Comments

  1. LayintheSmakDown

    September 9, 2013 at 4:47 pm

    One great thing for all progressives to do is join together to try to make a difference in their own communities! We know the government will not be there as much in the future and we need to band together to help the needs in our own backyard instead of crying that big brother is not coming with another government perk.

  2. The Stealth Of Nations

    September 9, 2013 at 5:20 pm

    a lot of laid off workers and those never able to find a good full time job in the first place have been forced to turn to the underground or informal economy to survive.

  3. david esmay

    September 9, 2013 at 5:51 pm

    “We’ve” all been contributing to our communities for years, so piss off LSD.

  4. gregflynn

    September 9, 2013 at 10:07 pm

    Most people I know are not only already making a positive difference in their own communities, but also in harder hit, less fortunate communities.

  5. Alan

    September 9, 2013 at 10:17 pm

    LSD,

    You are a despicable hypocrite. “We” need to band together, the team you represent is everything that is bad and unjust in our society. I do believe the government perks you refer to are al being absorbed by former staffers/interns in the McCrory camp. I look forward to the day when your team is ousted for their extremism and common sense is again at work in NC.

    You have no shame, you have no morals…

  6. Alex

    September 10, 2013 at 3:20 pm

    I’m noticing the Dunning-Krueger Effect is present on some of these postings ! No names needed !

  7. Alan

    September 10, 2013 at 3:45 pm

    Alex,

    Thankyou, I knew I see this before and couldn’t recall the disorder. I have now added to my favorites.

    I would think the only known remedy would be electric shock therapy, I will happily volunteer my services in this regard…