Commentary

More sobering state economic news

The latest from analysts at the N.C. Justice Center:

July Jobs Figures Show NC Falling Behind the Nation

RALEIGH (August 21, 2015) — The July labor market data released this morning show North Carolina continues to lag behind the nation in a few vital ways.
Wages in North Carolina are not growing as fast as the nation, and are actually down slightly compared to a year ago. Furthermore, the unemployment rate in North Carolina has gone up over the last six months while unemployment nationwide has fallen.

“North Carolina’s economy remains far from its position prior to the recession,” said Patrick McHugh, economic analyst with the Budget & Tax Center, a project of the NC Justice Center. “This reality is reflected in wage levels and a labor force participation rate that have yet to reach their pre-recession levels.”
Highlights of the July data include:

• Growing wage gap between North Carolina workers and the national average: For North Carolina, the average weekly paycheck came in at $763.49 in June. When factoring in inflation, the real buying power of wages in North Carolina remains well below pre-recession levels. Wages nationwide have grown faster than inflation over the last year. All told, this means that the average weekly North Carolina paycheck is now $101 less than the national average.
• Still more North Carolinians out of work than before the Great Recession: Even though the ranks of the unemployed have declined over the past year, there are still nearly 280,000 North Carolinians looking for work, approximately 64,000 more than before the Great Recession.
• Percent of North Carolinians employed still near historic lows: July numbers showed 57.6 percent of North Carolinians were employed. This leaves North Carolina well below the level of employment that was commonplace before the Great Recession. In the mid-2000s, employment levels reached a peak of about 63 percent. The percent of North Carolinians with a job remains below the national average, as it has been since the Great Recession.
• Labor force participation grows, but still below pre-recession norms: The size of the labor force, a measure of people who are employed or are looking for work, grew by just under 3 percent over the year. While this is a good sign that some workers are returning to the labor force, the share of North Carolinians who are employed or looking for work is still lower than before the Great Recession.
• US making much more progress in reducing unemployment than North Carolina: Even while the state continues to add jobs, growth is not enough to push unemployment below the 5 percent threshold that most economists see as the top-end of a healthy labor market. While the national unemployment rate has come down over the last six months, the ranks of the unemployed have grown here in North Carolina.

For more context on the economic choices facing North Carolina, check out a recent report on building an innovation economy for all and the Budget & Tax Center’s weekly Prosperity Watch platform.

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