NC Budget and Tax Center

North Carolina walking back economic progress according to new report

A report released yesterday by ThinkNC First argues that decision makers in Raleigh have walked away from many of the programs that helped to build a middle-class in North Carolina. Authors William Lester and Nichola Lowe of the University of North Carolina review data showing that middle-income jobs have become much harder to find over the last decade. The report ties this disturbing trend to recent policy decisions to underfund state programs that foster industries that create livable wages and ensure that all North Carolinians can access those jobs. The report makes a strong case that state leaders should heed our history and remember how North Carolina became an economic powerhouse in the Southeast in the first place.

The central problem documented in the report is becoming increasingly difficult to ignore. For the second half of the 20th century, North Carolina’s economy generated strong employment growth up a down the wage scale. Since the start of the Great Recession however, most of the job growth has been in either very high or very low paying industries. The labor market hollowed out, as many industries, particularly in manufacturing, saw employment decline. We here are the Budget and Tax Center have been watching this same trend, and its not pretty.

While many observers say that global market forces like offshoring and automation are to blame, the report’s authors argue that we don’t have to take the death of the middle-class as a foregone conclusion. Public-private partnerships like the NC Biotech Center, the Hosiery Technology Center, and the Manufacturing Solutions Center (just to name a few) helped to build industries that pay livable wages and keep North Carolina companies competitive on the global market. The University of North Carolina system helped to make our state an innovation leader in the Southeast and community colleges provided career pathways for North Carolinians the state over.

Unfortunately, many of the same initiatives that helped to build the middle-class have also seen their funding squeezed out in recent years. The report calls for reemphasizing the industry-specific support programs that have proven effective, strategically targeting emerging industries, and making sure that all working North Carolinians can make ends meet through increasing the minimum wage, strengthening labor standards, and giving local governments more leeway to craft living wage policies.

The report underscores the serious challenges that we face, but reminds us that North Carolina succeeded in the face of longer odds in the past.

3 Comments


  1. LayintheSmakDown

    July 10, 2015 at 9:54 pm

    All the screeching and whining about this being a North Carolina problem seems out of place. This type of story is out there as a trend for all of the United States. I kinda doubt the NCGA can have that much influence to affect the whole country…..but Barry Hussien Obama can…hmmm.

  2. Steve

    July 11, 2015 at 6:59 am

    The mainstream progressive argument has been weak and ineffective. Gotta’ have teeth with big bite.
    A gutted middle class or not providing plenty of middle income jobs for whatever reason- WHATEVER REASON- means not enough consumers can any longer afford to go shopping. As in spending REAL money that’s ACTUALLY BEEN EARNED, instead of freshly printed $$$ or pent up demand being squeaked out on over-extended credit alone. Well, duh?-!

  3. Steve

    July 11, 2015 at 7:15 am

    Freedom Fest 2015 – Moore vs Krugman
    “What Happened To The American Dream?”

    Everyone finally woke from the walking nightmare.

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