NC Budget and Tax Center

The State of Working North Carolina

Each year on Labor Day our State of Working North Carolina report details the economic conditions and trends that face North Carolina’s workers.  This year, in addition to focusing on these conditions and trends today, we also delved deeper how the current lack of jobs and the growth of low-wage jobs will impact the state’s economic future, particularly given demographic trends in the state.

This week’s Prosperity Watch takes a look in particular at the resiliency in the African-American labor force in the context of a shrinking of the state’s labor force and a significant number of North Carolinians who remain missing from the labor force.  Both trends are primarily driven by the lack of jobs and together are holding back the state’s full recovery.  Within these broader trends, however, and despite higher unemployment rates, African-American workers have remained in the labor force at a greater rate than other workers.  From Prosperity Watch:

In the face of high unemployment and labor market outcomes that are pushing African-Americans in particular further behind, an interesting trend has emerged.  In the nation as whole and North Carolina, African-American workers have demonstrated resiliency in their connection to the labor force. The unemployment rate for African-Americans remains much higher relative to whites, growing by 4.6 percentage points from 2007 to 2013 compared to a 2.7 percentage point change over the same period for whites. And yet, African-Americans have been much less likely to leave the labor force altogether despite weak job prospects.  The labor force participation rate changed from 2007 to 2013 for African-Americans by 2.6 percentage points while dropping far more for whites by 4.2 percentage points.

The labor force resiliency of African-American workers is contributing to the persistent difference in unemployment rates between African-Americans and whites.  But on the positive side, when jobs return, it could also position African-American workers for faster re-employment.

News, The State of Working North Carolina
MaryBe McMillan

MaryBe McMillan of the N.C. AFL-CIO answers questions from some of the reporters in attendance prior to this morning’s rally in Raleigh.

About a hundred people gathered next to the Fallen Firefighters Memorial in downtown Raleigh this morning for a rally/press conference to help kick off a three-stop “#TalkUnion” tour that is being by state union and civil rights leaders. The tour will also feature a noon event in Greensboro at the Beloved Community Center at 417 Arlington Street and conclude with a 5:30 p.m. rally in Charlotte’s Marshall Park at 800 east 3rd Street. All are invited.

The event in Raleigh featured Rev. William Barber of the North Carolina NAACP and state AFL-CIO Secretary-Treasurer MaryBe McMillan as well as rank and file workers and leaders from the local faith community.  All spoke of the desperate need in North Carolina to raise wages for average workers and to halt and reverse the conservative policy agenda of the state’s current political leadership.

The claims of the various speakers were boosted this morning by the release of the latest “State of Working North Carolina” report by experts at the North Carolina Justice Center.

This is from a release that accompanied the new report:

  • Almost six out of every 10 new jobs created since the end of the recession are in industries that pay poverty-level wages, keeping workers trapped in poverty even when they are working full-time.
  • The growth in low-wage work is disproportionately impacting workers of color and women: 13.2 percent of women, 13.5 percent of African-Americans, and 23 percent of Latinos earn below the living income standard, compared to 9.7 percent of men and 9 percent of whites.
  • The persistence of higher unemployment rates for African-Americans is in part being driven by the greater labor force resiliency of African-American workers. Since the recession, African-Americans have not dropped out of the labor force at the same level as white workers.
  • There are approximately 260,000 North Carolina working families who live in poverty, with 12.8 percent of working families earning poverty wages.
  • 13 of 14 metro areas saw labor forces decline since June 2013. For eight metros, the decline in unemployment was driven by the unemployed moving out of the labor force rather into jobs.
  • Rural employment dropped 2.7 percent since the start of the recovery while the state’s large metropolitan areas have seen 6.5 percent job growth.

These data coincided neatly with Rev. Barber’s statement in announcing today’s tour in which he noted:

“While we honor our workers on Labor Day, we cannot ignore the policies and laws passed down from this North Carolina General Assembly that are attacking poor and working families. We believe North Carolinians who work 40 hours each week should be able to put food on their tables and buy school clothes for their children. The long fight for labor rights, for voting rights, for educational equality and for quality health care for all is not a fight between Republican and Democrat. It is a moral fight for the soul of the nation. That is why we are making this Labor Day a Moral Monday.”

Click here for more information on the #TalkUnion tour.”

Click here to read the entire “State of Working North Carolina” report.

Back to School Series, NC Budget and Tax Center

This is part of a Back to School blog series that highlight various issues to be aware of as the 2014-15 school year kicks off. (See Part 1, Part 2, Part 3, and Part 4)

Little things can make big differences in children’s lives. Something as simple as arriving to class with food in your stomach can enhance a child’s learning experience. Many schools across North Carolina recognize this and are offering breakfast and lunch to all of their students at no charge this school year.

As part of the nationwide Community Eligibility Program (CEP), high-poverty schools in at least 36 school systems across North Carolina will provide breakfast and lunch to all students free of charge. This effort not only aims to help end childhood hunger – one in five American schoolchildren can’t count on getting enough nutritious food at home – but also aims to enhance the classroom experience of students. Ensuring that children show up in classrooms each day fed and ready to learn increases the chances of students being more focused, attentive, and engaged.

The school year marks the first year in which eligible schools nationwide can participate in CEP. With all students provided breakfast and lunch free of charge, participating schools are no longer required to collect school meal applications, which reduces administrative costs. These cost savings can now be directed towards covering the cost of the school meals that are provided. Read More

Back to School Series, NC Budget and Tax Center

This is part of a Back to School blog series that highlight various issues to be aware of as the 2014-15 school year kicks off. (See Part 1 and Part 2)

This week, more than 1.5 million North Carolina’s students headed back to school to underfunded classrooms. For yet another school year, teachers will do their best to prepare today’s students to grow into critical thinkers and succeed as workers in a demanding 21st century economy with too few resources available. Legislative leadership and the Governor approved a budget that fails to make up lost ground in public education, keeping spending below the last budget that was in place before the Great Recession.

In fact, when the pay raises for teachers are properly placed in the salaries and reserves section of the General Fund budget and not the public education section—a practice that has long been in place—public education spending in the new budget is below last year’s spending levels (see graphic below). This certainly is not progress, but rather sliding backwards with a budget trick used as cover.

Five years into the recovery from the worst economic downturn since the 1930s, catching up and keeping up with the needs of North Carolina’s students is stalled due to the fact that lawmakers chose to enact a tax plan last year that keeps the state from replacing the most damaging cuts to public investments. The 2013 tax plan is draining available resources—$5.4 billion over five years—that is needed to regain lost ground and reinvest in the building blocks of a strong economy. The tax plan’s impact is evident throughout the final budget for fiscal year 2015. Read More

Back to School Series, NC Budget and Tax Center

Cross-posted on the Prosperity Watch platform.

As North Carolina’s young people head back to school this week, it is their increased educational attainment that has the greatest potential to not only generate improved earnings and provide some protection against the worst employment outcomes their lifetime but also strengthen the state’s overall economic recovery and economy.

States with higher educational attainment not only have higher productivity but higher median wages. The increases in production of goods and services benefit the median worker in these states.

PW_Higher Educational AttainmentThat is a welcome outcome in light of national trends and what is happening in North Carolina. For the past thirty years, as the economy has become more productive, wages for the average worker have actually stagnated. In North Carolina, particularly in the most recent post-recession period, wages have actually fallen despite productivity growth.

Jobs without good wages, increased productivity without wage growth are not the markers of a successful economy. States have a unique opportunity to pursue an economic development strategy through education that is focused on increasing the wages of the median worker in the state and thus improving their well-being. Read More