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As we approach Labor Day weekend, new data from the state Division of Employment Security  shows unemployment rates fell in 97 of North Carolina’s 100 counties last month. However, most of the job growth this past year has occurred in Leisure & Hospitality, the lowest-wage sector.

This industry pays roughly $12 below the statewide average, according to analysis by the NC Budget & Tax Center.

MaryBe McMillan with the NC State AFL-CIO says it’s troubling that the employment opportunities that have replaced the manufacturing jobs lost during the recession fail to provide families a living wage:

“Folks cannot get by on $7.25 an hour, and it’s long overdue we raise the minimum wage, make it a living wage, index it to inflation so we are not going another decade or so without a wage increase,” explained McMillan in an interview with NC Policy Watch.

Minimum wage workers and their supporters will gather today (Thursday) in cities across the nation, including Raleigh, asking to be paid $15 an hour.

For a preview of McMillan’s radio interview with Chris Fitzsimon, click below:

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This week’s issue of Prosperity Watch grapples with an under-reported and historically unprecedented trend in North Carolina’s economy–while the state has experienced a total of more than 4 percent total growth in Gross Domestic Product from 2006 through 2011, job creation over this period has been virtually nonexistant. This trend in manufacturing is even more pronounced.

So what’s causing this troubling divergence between economic output and job creation? See the latest Prosperity Watch for details.

According to the latest issue of Prosperity Watch, North Carolina’s job growth has remained stubbornly stagnant over the last year, with the unemployment rate stuck between 9.6 and 9.4 since February 2012. Even more troubling, however, is the fact that what little employment growth the state has experienced since the end of the recession has largely occurred in low-wage service industries. In effect, the state is losing the middle-wage jobs that used to provide a pathway into the middle class for many North Carolinians and replacing them with jobs in industries that pay significantly below the state average—a boom in low-wage employment.  See the latest issue of Prosperity Watch for details.

Earlier this week, the N.C. Division of Employment Security released the latest jobs numbers for January, and unsurprisingly, North Carolina’s labor market is continuing to struggle. As the latest issue of Prosperity Watch makes clear, the state’s employment recovery is still lagging the national average, and despite slowly beginning to close this gap, much work remains to provide adequate employment opportunities for North Carolina’s workers.  See the latest Prosperity Watch for details.

 

In his press conference yesterday, North Carolina House Speaker Thom Tillis reiterated his desire to eliminate the state’s corporate income tax, expressing his earnest (but misguided) belief that abolishing the tax will ensure stronger job creation across the state. This belief is misguided because it rests on a fundamentally flawed assumption—that corporations will always reinvest the savings they get from the tax repeal into creating new jobs or paying existing workers higher wages inside North Carolina.

In reality, there is no guarantee that multinational corporations with locations and subsidiaries across the entire world will take their North Carolina state tax cut and reinvest it in their North Carolina operation. In fact, if we look at recent national corporate investment patterns, there’s actually no guarantee that these corporations will reinvest additional income in job creation (or higher wages) at all.  

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