Local Unemployment Rates Down over The Year
CHAPEL HILL, NC (October 1, 2014) – Between August 2013 and August 2014, unemployment rates fell in 96 of North Carolina’s 100 counties and in all 14 of the state’s metropolitan areas. Yet over the same period, the size of the local labor force shrank in 84 counties and in 10 metro areas.
These findings come from new estimates released today by the Labor and Economic Analysis Division of the North Carolina Department of Commerce.
“Local unemployment rates decreased across most of North Carolina over the past year,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “At the same time, the declines do not alter the fact that unemployment remains a serious problem. In fact, 56 counties and 11 metro areas had unemployment rates in August 2014 that exceeded those posted in August 2008.”
Compared to December 2007, which is when the national economy fell into recession, North Carolina now has 0.3 percent fewer payroll jobs (-14,300). In August, the state gained 12,500 more jobs than it lost (+0.3 percent). Since bottoming out in February 2010, the state’s labor market has netted some 5,820 jobs per month, resulting in a cumulative gain of 314,500 positions (+8.2 percent). At that rate, all else equal, it would take until late 2014 for the state to have as many payroll jobs as it did at the end of 2007.
Between July and August 2014, local unemployment rates increased in 74 of the state’s 100 counties, decreased in 12 counties, and held constant in 14 counties. Individual county rates in August ranged from 4 percent in Currituck County to 13.4 percent in Graham County. Overall, 9 counties posted unemployment rates greater than or equal to 10 percent, and 54 counties posted rates between 7 and 9.9 percent. (Because seasonal fluctuations in labor markets are pronounced in the summer, month-to-month changes provide limited insight into trends.)
“Non-metropolitan labor markets still lag behind metropolitan ones,” noted Quinterno. “In August, 7.7 percent of the non-metro labor force was unemployed, compared to 6.7 percent of the metro labor force. Compared to December 2007, the non-metro labor force now has 4.1 percent fewer employed persons, while the number of unemployed individuals is 32 percent larger. Over that time, the size of the non-metro labor force has increased by 6.4 percent. In fact, North Carolina’s total labor force in August would have been 1.2 percent larger if the size of the nonmetropolitan labor force had held steady, all else being equal”
Between July and August, unemployment rates rose in 9 of the state’s 14 metro areas. Rocky Mount had the highest unemployment rate (10.2 percent), followed by Fayetteville (8.2 percent) and Hickory-Morganton-Lenoir (7.5 percent). Asheville had the lowest unemployment rate (5.3 percent), followed by Durham-Chapel Hill and Raleigh-Cary (both 5.7 percent).
Compared to August 2013, unemployment rates in August 2014 were lower in 96 counties and all 14 metro areas. Over the year, however, labor force sizes decreased in 84 counties and in 10 metros. And the statewide labor force (seasonally adjusted) was 0.4 percent smaller (-18,567 individuals) in August 2014 than it was in August 2013.
Among metros, Rocky Mount’s labor force contracted at the fastest rate (-3.6 percent) over the course of the year, followed by Hickory-Morganton-Lenoir (-2 percent) and Fayetteville (-1.9 percent). With those changes, metro areas now are home to 72.4 percent of the state’s labor force, with 51.2 percent of the labor force residing in the Triangle, Triad, and Charlotte metros.
In the long term, improvements in overall labor market conditions depend on growth in the Charlotte, Research Triangle, and Piedmont Triad regions. Yet growth in these metros, though improved in recent months, remains subdued. Collectively, employment in the three metro regions has risen by 5.3 percent since December 2007, and the combined unemployment rate in August totaled 6.5 percent, as compared to 6.3 percent in August 2008. Of the three broad regions, the Research Triangle had the lowest unemployment rate (5.8 percent), followed by Charlotte and the Piedmont Triad (both 7 percent).
The local employment report for August also provided insights into the effects of the extensive changes to the state’s system of unemployment insurance implemented last summer. Last month, the number of regular unemployment insurance initial claims filed in North Carolina totaled 20,279, down from the 28,443 initial claims filed a year earlier (-28.7 percent).
Mecklenburg County was home to greatest number of regular initial claims (2,453), followed by Wake (1,695), Guilford (1,107), Cumberland (709), and Forsyth (639) counties.
In August 2014, North Carolinians received a (nominal) total of $34.2 million in regular state-funded and federal unemployment insurance compensation, down from the (nominal) $80.1 million received in August 2013. This decline (-57.3 percent) is attributable to a mix of factors, such as drops in the number of insurance claims resulting from economic improvements and legal changes that restricted eligibility for insurance compensation.
Additionally, the state’s decision to exit the federal Emergency Unemployment Compensation (EUC) program reduced the amount of federal unemployment insurance compensation flowing into the state in August. Between August 2013 and August 2014, the amount of federal unemployment insurance benefits paid to North Carolinians fell by 75.6 percent, dropping to a (nominal) total of $1.1 million from a (nominal) total of $4.5 million. (Note that the US Congress allowed the EUC program to expire at the start of 2014.)
“Even with recent improvements in certain important indicators, many local labor markets in North Carolina continue to underperform and have yet to recover from the last recession,” said Quinterno. “The August data were consistent with the basic pattern of slow growth that has defined the state’s economy for the past 4.5 years.”