12.01.2011 News Releases, Policy Points

Local Labor Markets Deteriorate Over The Year

CHAPEL HILL (December 1, 2011) – Between October 2010 and October 2011, unemployment rates rose in 78 of North Carolina’s 100 counties and in 12 of the state’s 14 metropolitan areas. At the same time, 36 counties and 5 metros had labor forces in October that were smaller in size compared to one year ago. These findings come from new estimates from the Division of Employment Security.

“Unemployment rates rose across most of North Carolina during the past year,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “In 53 counties, at least 10 percent of the labor force was unemployed in October, up from 44 counties a year ago. Similarly, the size of the labor force fell in 36 counties, which indicates that joblessness is more widespread than captured in the official unemployment measure.”

Since the economy fell into recession in December 2007, North Carolina has lost, on net, 7.2 percent of its payroll employment base (-300,500 positions) and has seen its unadjusted unemployment rate climb from 4.7 percent to 9.7 percent. In October, the state netted 5,500 payroll jobs. Since bottoming out in February 2010, the state’s labor market has netted an average of 1,100 jobs per month, resulting in a cumulative gain of just 22,500 positions.

Between September and October, unemployment rates fell in 83 counties. Unemployment rates nevertheless were at or above 10 percent in 53 counties. Individual county rates ranged from 5.4 percent in Currituck County to 16.6 percent in Scotland County. Compared to a year ago, unemployment rates were higher in 78 counties, unchanged in 4 counties, and lower in 18 counties.

“Non-metropolitan labor markets remained especially weak in October,” added Quinterno. “Last month, 10.6 percent of the non-metro labor force was unemployed, compared to 9.3 percent of the metro labor force. Over the year, the size of the rural labor force and the number of employed rural residents rose by 1.2 percent and 0.9 percent, respectively, but the number of unemployed individuals jumped by 4.1 percent. This dynamic drove the unemployment rate to 10.6 percent from 10.3 percent. Compared to December 2007, the non-metro labor force now is 2.8 percent smaller. Similarly, the number of employed rural residents has fallen by 8.1 percent, while the number of unemployed rural persons has grown by 86.1 percent and now totals 138,210.

Last month, unemployment rates rose in 12 of the state’s metropolitan areas and held steady in one metro, Hickory-Morganton-Lenoir. Rocky Mount had the highest unemployment rate (13 percent), followed by Hickory-Morganton-Lenoir (11.7 percent). Durham-Chapel Hill had the lowest rate (7.5 percent), followed by Asheville (7.7 percent).

Compared to October 2010, unemployment rates were higher in 78 counties and 12 metros. Moreover, 36 counties and 5 metros had smaller labor forces. Among metros, Hickory-Morganton-Lenoir recorded the largest decline in the size of its labor force (-1.8 percent), followed by Wilmington (-1.5 percent). Fayetteville posted the largest increase (+2.4 percent), followed by Winston-Salem (+1.8 percent), and Greensboro (+1 percent).

In the long term, any meaningful recovery will hinge on growth in the state’s three major regions: Charlotte, the Research Triangle, and the Piedmont Triad. Yet growth remains sluggish. Collectively, employment in these three metro regions has fallen by 3.7 percent since December 2007, and the combined October unemployment rate in the three metros equaled 9.1 percent. Of the three broad regions, the Research Triangle had the lowest unemployment rate (8 percent), followed by the Piedmont Triad (9.8 percent), and Charlotte (10.5 percent).

“North Carolina’s local labor markets recorded few meaningful improvements over the past year,” said Quinterno. “Statewide job growth has been anemic at best, and as a result, unemployment rates actually have risen across much of the state.”

“Labor market indicators continue to move in the wrong direction. With the year nearly over, 2011 likely will fail to deliver any real improvements to North Carolina’s local job markets or relief for the state’s unemployed residents.”

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