News Releases

19.09.2014 News Releases, Policy Points No Comments

NC’S Labor Market Wilts In August

CHAPEL HILL, NC (September 19, 2014) – In August, employers in North Carolina added 12,500 more payroll jobs than they cut (+0.3 percent), due largely to hiring by local governments. The monthly household survey, meanwhile, recorded a rise in the unemployment rate to 6.8 percent, even though the size of the labor force fell over the month. With those changes, North Carolina has 0.3 percent fewer jobs, 37.7 percent more unemployed persons, and a much higher unemployment rate (+1.8 percentage points) than it did over 6.5 years ago.

These findings come from new data released today by the Labor and Economic Analysis Division of the NC Department of Commerce.

“The August employment report offered little evidence of a labor market that has turned a corner,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Last month, North Carolina netted some jobs, but at the same time, the state experienced declines in the size of the labor force and the number of employed residents. Although conditions in the state are better in some ways than they were a year ago, they still have not returned to healthy levels.”

Between July 2014 and August 2014, North Carolina employers added 12,500 more jobs than they cut (+0.3 percent). Private-sector payrolls netted just 4,000 positions (+0.1 percent), and public-sector payrolls gained, on net, 8,500 jobs (+1.2 percent), owing primarily to net hiring by local governments (+6,700, +1.6 percent). Within private industry, the education and health services sector netted the most jobs (+2,700, +0.5 percent), followed by the professional and business services sector (+2,500, +0.4 percent) and the manufacturing sector (+1,900, +0.4 percent). Meanwhile, the leisure and hospitality services sector shed the most jobs (-3,300 jobs, -0.7 percent), followed by the construction sector (-1,300, -0.7 percent). All other major industrial sectors experienced few changes in payroll sizes.

A revision to the July 2014 payroll data found that the state gained 1,400 more jobs that month than first estimated (+17,200 versus +15,800). With the revision, North Carolina has, on net, 14,300 fewer payroll positions (-0.3 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 5,800 payroll jobs per month, resulting in a cumulative gain of 314,500 positions (+8.2 percent). At that rate, holding all else equal, it would take until later this year for the state to have as many jobs as it did at the end of 2007.

“While positive, the pace of payroll growth in North Carolina has not accelerated radically in recent years,” noted Quinterno. “Between August 2013 and August 2014, the total number of payroll jobs in North Carolina grew by 2.4 percent. Between August 2012 and August 2013, the total of number payroll jobs in North Carolina rose by 1.7 percent, while between August 2011 and August 2012, the rate of growth was 1.6 percent. In effect, North Carolina has been mired in a pattern of slow job growth for the past several years.”

The household data recorded in August contained negative news about the state’s labor market. Last month, the statewide unemployment rate rose to 6.8 percent, which was the highest rate logged so far this year. Furthermore, the underlying dynamics of the labor market were unimpressive. Last month, the number of employed persons in the state fell by 28,666 (-0.7 percent), while the number of unemployed persons increased by 10,404 (+3.4 percent). And last month, the size of the North Carolina labor force decreased by 18,262 persons (-0.4 percent).

While the changes in household data recorded between July and August were negative, the changes over the past year were more mixed. Between August 2013 and August 2014, the number of unemployed North Carolinians fell by 57,505 persons (-15.4 percent), but 49.7 percent of the decline was attributable to people who left the labor force entirely. If those 28,567 persons were added back to the labor force and considered unemployed, the statewide unemployment rate in August would have equaled 7.3 percent. Even if 50 percent of those individuals were added back to the labor force and considered unemployed, the statewide unemployment rate would have equaled 7.1 percent.

Year-over-year declines in the statewide labor force participation rate provide additional evidence of an underperforming labor market. In August, the share of working-age North Carolinians participating in the labor market was 60.5 percent, which was lower than the 61.6 percent figure logged a year ago, as well as the lowest monthly rate recorded at any time since January 1976.

In addition, another important measure of labor utilization, the employment-to-population ratio, fell over the year, dropping to 56.4 percent from 56.7 percent. The current share of working-age North Carolinians with a job now is just 0.1 percentage points above the 38-year low of 56.3 percent posted in 2011.

The August labor market report provides additional insight into the effects of the extensive changes to the state’s system of unemployment insurance implemented last summer. Between July and August, the number of claimants of regular state-funded insurance rose by 1 percent, increasing to 39,466 from 39,066. Compared to a year earlier, however, 35,024 fewer individuals received regular state-funded insurance in August (-47 percent).

Also in August, the state paid a (nominal) total of $33.1 million in regular state-funded unemployment insurance compensation, an amount 56.2 percent lower than the (nominal) total of $75.6 million paid in August 2013.

“North Carolina netted jobs in August, but the current pace of job growth is not much greater than the rate needed to keep pace with population growth,” added Quinterno. “Observers also should be concerned that the number of unemployed North Carolinians and the statewide unemployment rate have trended upward in recent months, while the number of employed persons has trended downward. Keep in mind, too, that a steady decline in the size of the labor force is masking some of the broader problems in the labor market and actually making conditions appear somewhat better than they are.”

01.08.2014 News Releases, Policy Points No Comments

US Labor Market Cooled In July

CHAPEL HILL, NC (August 1, 2014) – In July, the national labor market added 209,000 more jobs than it lost due primarily to gains in the private sector. At the same time, the unemployment rate ticked up by 0.1 percentage points to 6.2 percent. While employment increased and the labor force grew, the changes were modest. Overall labor market conditions in the United States consequently remain far from healthy.

“July was the 46th-straight month in which the United States experienced net job growth,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Over the year, the economy has netted an average of 214,000 jobs per month, a pace that remains inadequate to repair the damage inflicted on the national labor market in the wake of the last recession.”

In July, the nation’s employers added 209,000 more payroll jobs than they cut. Some 95 percent of the gain originated in the private sector (+198,000), while public employers added 11,000 more positions than they cut. Within the private sector, payroll levels increased the most in the professional and business services sector (+47,000, with 34.3 percent of the gain occurring in the administrative and waste services subsector), followed by the trade, transportation, and utilities sector (+39,000, with 68.5 percent of the gain originating in the retail trade subsector) and the manufacturing sector (+28,000, with all of the increase originating in the manufacture of durable goods). Payroll levels in the other major industry groups either rose in July or essentially held steady.

Additionally, the payroll employment numbers for May and June underwent revisions; with the updates, the economy netted 527,000 jobs over those two months, not the 512,000 positions previously reported. With those changes, the average pace of monthly job growth in the United States recorded over the past year rose to 214,000.

“The United States has experienced steady job growth for almost four years, but the pace of growth has been modest relative to the severity of the job losses caused by the last recession,” noted Quinterno. “While the country now has more payroll jobs than it did in December 2007, the current average monthly rate of job growth is insufficient to close the jobs gap caused by the recession—a gap now estimated at 6.6 million jobs—anytime soon.”

Data from the household survey offered mixed news about the health of the United States’ labor market. In July, the number of Americans who reported having jobs rose by 131,000 (+0.1 percent); put differently, more people reported having jobs in July than in June. At the same time, the overall size of the labor force rose by 329,000 persons (+0.2 percent) between June and July. Meanwhile, the share of working-age Americans participating in the labor force rose in July, while the share of working-age Americans with jobs held steady.

In July, 9.7 million Americans were unemployed (6.2 percent), while 7.5 million individuals worked part time despite preferring full-time positions. Another 741,000 individuals (not seasonally adjusted) were so discouraged about their job prospects that they had stopped searching for work altogether. Those persons were part of a larger population of 2.2 million Americans who were marginally attached to the labor force.

Compared to a year ago, 2.1 million more Americans were working in July, and 1.7 million fewer persons were unemployed. At the same time, the share of the working-age population with a job (59 percent) remained at a depressed level, while the share of the population that was participating in the labor force fell to 62.9 percent from 63.4 percent.

Last month, the unemployment rate was identical for adult male and female workers (5.7 percent). Unemployment rates were higher among Black (11.4 percent) and Hispanic workers (7.8 percent) than among white ones (5.3 percent). The unemployment rate among teenagers was 20.2 percent.

Additionally, 6 percent of all veterans were unemployed in July, and the rate among recent veterans (served after September 2001) was 9.2 percent. At the same time, 12.1 percent of Americans with disabilities were jobless and seeking work (not seasonally adjusted).

Jobs remained comparatively hard to find in July. Last month, the underemployment rate equaled 12.2 percent, down from the 13.9 percent rate logged a year ago. Among unemployed workers, 32.9 percent had been jobless for at least six months, as opposed to 37.2 percent a year earlier, and the average spell of unemployment equaled 32.4 weeks, down from 36.7 weeks in July 2013.

In July, the leading cause of unemployment remained a job loss or the completion of a temporary job, which was the reason cited by 50.3 percent of unemployed persons. Another 29.5 percent of unemployed persons were re-entrants to the labor market, while 11.3 percent were new entrants. Voluntary job leavers accounted for the remaining 8.9 percent of the total.

“The July employment report offered a portrait of a national job market that has improved yet is far from healed,” observed Quinterno. “The magnitude of the problems caused by the last recession coupled with an excruciatingly slow recovery have obscured how unusual current conditions are and have created a distorted picture of what a healthy job market looks like.”

30.07.2014 News Releases, Policy Points No Comments

Local Unemployment Rates Down Over The Year

CHAPEL HILL, NC (July 30, 2014)  Between June 2013 and June 2014, unemployment rates once again fell in all of North Carolina’s 100 counties and in all 14 of the state’s metropolitan areas. Over the same period, labor force sizes shrank in 90 counties and in 12 metro areas. 

These findings come from new estimates released by the Labor and Economic Analysis Division of the North Carolina Department of Commerce. 

“Local unemployment rates fell across all 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. “Although many local labor markets currently have some of the lowest unemployment rates since late 2007, unemployment remains a serious problem. In fact, 61 counties and 9 metro areas have unemployment rates greater than those posted in June 2008.” 

Compared to December 2007, which is when the national economy fell into recession, North Carolina now has 1.2 percent fewer payroll jobs (-48,500). In June, the state lost 5,800 more jobs than it lost (-0.1 percent). Since bottoming out in February 2010, the state’s labor market has netted some 5,390 jobs per month, resulting in a cumulative gain of 280,300 positions (+7.3 percent). At that rate, all else equal, it would take until early 2015 for the state to have as many payroll jobs as it did at the end of 2007.

Between May and June 2014, local unemployment rates decreased in 81 of the state’s 100 counties, increased in 10 counties, and held constant in 9 counties. Individual county rates in June ranged from 4.2 percent in Currituck County to 12.1 percent in Scotland County. Overall, 3 counties posted unemployment rates greater than or equal to 10 percent, and 54 counties posted rates between 6.6 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 continue to lag behind metropolitan ones,” noted Quinterno. “In June, 7.1 percent of the non-metro labor force was unemployed, compared to 6.2 percent of the metro labor force. Compared to December 2007, the non-metro labor force now has 3.7 percent fewer employed persons, while the number of unemployed individuals is 24.2 percent larger. Over that time, the size of the non-metro labor force has fallen by 2.2 percent.” 

Between May and June, unemployment rates dropped in 13 of the state’s 14 metro areas. Rocky Mount had the highest unemployment rate (9.6 percent), followed by Fayetteville (7.5 percent) and Greenville and Hickory-Morganton-Lenoir (both 6.9 percent). Asheville had the lowest unemployment rate (4.9 percent), followed by Durham-Chapel Hill (5.1 percent) and Raleigh-Cary (5.2 percent). 

Compared to June 2013, unemployment rates in June 2014 were lower in all 100 counties and all 14 metro areas. Over the year, however, labor force sizes decreased in 90 counties and in 12 metros. In fact, the statewide labor force (seasonally adjusted) was 0.3 percent smaller (-11,953 individuals) in June 2014 than it was in June 2013. 

Among metros, Rocky Mount’s labor force contracted at the fastest rate (-3.4 percent) over the course of the year, followed by Fayetteville (-3.1 percent) and Hickory-Morganton-Lenoir (-2.9 percent). With those changes, metro areas now are home to 72 percent of the state’s labor force, with 50.8 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, although improved in recent months, remains subdued. Collectively, employment in the three metro regions has risen by 5.9 percent since December 2007, and the combined unemployment rate in June totaled 6 percent (compared to 5.8 percent in June 2008). Of the three broad regions, the Research Triangle had the lowest June unemployment rate (5.3 percent), followed by Charlotte (6.4 percent) and the Piedmont Triad (6.5 percent).  

The local employment report for June 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 24,209, down from the 44,734 initial claims filed a year earlier (-45.9 percent). 

Mecklenburg County was home to greatest number of regular initial claims (2,961), followed by Wake (2,103), Guilford (1,522), Cumberland (860), and Forsyth (822) counties. 

In June 2014, North Carolinians received a (nominal) total of $38 million in regular state-funded and federal unemployment insurance compensation, down from the (nominal) $189.4 million received in June 2013. This sharp decline (-79.9 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 June. Between June 2013 and June 2014, the amount of federal unemployment insurance benefits paid to North Carolinians fell by 98.8 percent, dropping to a (nominal) total of $1.1 million from a (nominal) total of $95.2 million. (Note that the US Congress allowed the EUC program to expire at the start of 2014.)

“Despite recent improvements in some important indicators, labor market conditions in communities across North Carolina still have not returned to their pre-recessionary states,” said Quinterno. “The June data showed little deviation from the basic pattern that has characterized the state’s labor market for the past four years; namely, a painfully slow recovery.” 

18.07.2014 News Releases, Policy Points No Comments

North Carolina’s Slow Recovery Continues

CHAPEL HILL, NC (July 18, 2014) – In June, employers in North Carolina shed 5,800 more payroll positions than they added (-0.1 percent), due almost entirely to reductions in the payrolls of local governments. The monthly household survey, meanwhile, recorded no change in the unemployment rate (6.4 percent), even though the number of employed persons fell over the month. With those developments, North Carolina has 1.2 percent fewer payroll jobs, 30.9 more unemployed residents, and a higher unemployment rate (+1.4 percentage points) than it did 6.5 years ago.

These findings come from new data released today by the Labor and Economic Analysis Division of the NC Department of Commerce.

“The June employment report is indicative of a state labor market experiencing a painfully slow recovery,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Last month, North Carolina lost more jobs than it gained, and the state experienced declines in both the size of the labor force and the number of employed residents. While conditions in the state are better in some ways than they were a year ago, they still have not returned to their pre-recessionary levels.”

Between May 2014 and June 2014, North Carolina employers cut 5,800 more jobs than they added (-0.1 percent). Private-sector payrolls netted 7,500 positions (+0.2 percent), but public-sector payrolls shed, on net, 13,300 jobs (-1.9 percent), owing primarily to reductions by local governments. Within private industry, the professional and business services sector netted the most jobs (+3,700, with almost of the gains occurring in administrative and waste management subsector), followed by the financial activities sector (+3,400, +1.6 percent) and the trade, transportation, warehousing, and utilities sector (+1,000, with almost all the gain originating in the retail trade subsector). Meanwhile, the information sector shed 500 more jobs than it added (-0.7 percent). All other major industrial sectors experienced little change in payroll size.

A revision to the May 2014 payroll data found that the state gained 3,000 more jobs that month than first estimated (+8,700 versus +5,700). With the revision, North Carolina has, on net, 48,500 fewer payroll positions (-1.2 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 5,400 payroll jobs per month, resulting in a cumulative gain of 280,300 positions (+7.3 percent). At that rate, holding all else equal, it would take until early 2015 for the state to have as many jobs as it did at the end of 2007.

“While positive, the pace of payroll growth in North Carolina has not changed radically over the past year,” noted Quinterno. “Between June 2013 and June 2014, the total number of payroll jobs in North Carolina grew by 1.8 percent, a rate similar to that seen in prior years. Between June 2012 and June 2013, the total of number payroll jobs in North Carolina rose by 1.7 percent, while between June 2011 and June 2012, the rate of growth was 1.5 percent. In effect, North Carolina has logged the same slow rate of job growth for several years in a row.”

The household data recorded in June contained negative news about the state’s labor market. Last month, the statewide unemployment rate held steady at 6.4 percent, even though the number of employed persons fell by 8,577 (-0.2 percent). However, a decline in the size of the statewide labor force (-10,719 persons, -0.2 percent) blunted the impact of the drop in employment. Remember, however, that the monthly changes in the June data should be interpreted cautiously due to the seasonal dynamics often present at the start of summer.

While the changes in household data recorded between May and June appeared negative, the data for changes over the past year were more mixed. Between June 2013 and June 2014, the number of unemployed North Carolinians fell by 89,007 persons (-22.9 percent), but 13.4 percent of the decline was attributable to people who left the labor force entirely. If those 11,953 persons were added back to the labor force and considered unemployed, the statewide unemployment rate in June would have equaled 6.6 percent. Even if 50 percent of those individuals were added back to the labor force and considered unemployed, the statewide unemployment rate would have equaled 6.5 percent.

Year-over-year declines in the statewide labor force participation rate provide additional evidence of an underperforming labor market. In June 2014, the share of working-age North Carolinians participating in the labor market equaled 61.1 percent, which was lower than the 62 percent figure recorded a year ago. The June labor force participation rate was only slightly above the lowest monthly figure (61 percent) recorded at any time since January 1976.

In contrast, another important measure of labor utilization, the employment-to-population ratio, rose over the year, climbing to 57.2 percent from 56.8 percent. Nevertheless, the current share of working-age North Carolinians with a job is just 0.9 percentage points above the 38-year low of 56.3 percent posted in 2011.

The June labor market report provided additional insight into the effects of the extensive changes to the state’s system of unemployment insurance implemented last summer. Between May and June, the number of claimants of regular state-funded insurance fell by 4.8 percent, dropping to 40,347 from 42,382. Compared to a year earlier, 50,631 fewer individuals received regular state-funded insurance in June (-55.7 percent).

Also in June, the state paid a (nominal) total of $36.8 million in regular state-funded unemployment insurance compensation, an amount 60.9 percent lower than the (nominal) total of $94.2 million paid in June 2013.

“Despite some improvements in North Carolina’s labor market over the year, most of the improvements have been marginal ones,” added Quinterno. A consideration of indicators other than the important-yet-limited unemployment rate reveals a labor market that is adding jobs too slowly to overcome the consequences of the last recession anytime soon.”

03.07.2014 News Releases, Policy Points No Comments

US Labor Market Improves In June

CHAPEL HILL, NC (July 3, 2014) – In June, the national labor market added 288,000 more jobs than it lost due primarily to gains in the private sector. At the same time, the national unemployment rate dropped to 6.1 percent. The drop in unemployment was a positive development attributable to more people reporting themselves as being employed. Nevertheless, unemployment in the United States remains elevated, while other important measures of labor utilization remain near depressed levels.

“June was the 45th-straight month in which the United States experienced net job growth,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Over the year, the economy has netted an average of 208,000 jobs per month, a pace that, while positive, still is insufficient to replace all of the jobs lost since 2007 and to accommodate subsequent population growth.”

In June, the nation’s employers added 288,000 more payroll jobs than they cut. Some 91 percent of the gain originated in the private sector (+262,000), while public employers added 26,000 more positions than they cut. Within the private sector, payroll levels rose the most in the trade, transportation, and utilities sector (+72,000, with 55.8 percent of the gain originating in the retail trade subsector), followed by the professional business services sector (+67,000, with 51.3 percent of the gain occurring in the administrative and waste services subsector), the leisure and hospitality services sector (+39,000, with 89.7 percent of the gain originating in the accommodation and food service sector), and the education and health services sector (+38,000). Payroll levels in the other major industry groups either rose in June or essentially held steady.

Additionally, the payroll employment numbers for April and May underwent revisions; with the updates, the economy netted 528,000 jobs over those two months, not the 499,000 positions previously reported. With those changes, the average pace of monthly job growth in the United States recorded over the past year rose to 208,000 from 198,000.

“The United States has experienced steady job growth for the past 3.75 years, but the pace of growth has been modest relative to the severity of the job losses caused by the last recession,” noted Quinterno. “The current average monthly rate of job growth is insufficient to close the nation’s jobs gap—a gap now estimated at 6.7 million jobs—anytime soon.”

Data from the household survey offered additional positive news about the health of the United States’ labor market. In June, the number of Americans who reported having jobs rose by 407,000 (+0.3 percent); put differently, more people reported having jobs in June than in May. At the same time, the overall size of the labor force rose by 81,000 persons (+0.1 percent) between May and June. Meanwhile, the share of working-age Americans participating in the labor force held steady in June, while the share of working-age Americans with a job ticked up over the month.

In June, 9.5 million Americans were unemployed (6.1 percent), while 7.5 million individuals worked part time despite preferring full-time positions. Another 676,000 individuals (not seasonally adjusted) were so discouraged about their job prospects that they had stopped searching for work altogether. Those persons were part of a larger population of 2.1 million Americans who were marginally attached to the labor force.

Compared to a year ago, 2.1 million more Americans were working in June, and 2.3 million fewer persons were unemployed. At the same time, the share of the working-age population with a job (59 percent) remained at a depressed level, while the share of the population that was participating in the labor force decreased over the year, falling to 62.8 percent from 63.5 percent.

Last month, the unemployment rate was higher among adult male workers than female ones (5.7 percent versus 5.3 percent). Unemployment rates were higher among Black (10.7 percent) and Hispanic workers (7.8 percent) than among white ones (5.3 percent). The unemployment rate among teenagers was 21 percent.

Additionally, 5.4 percent of all veterans were unemployed in June, and the rate among recent veterans (served after September 2001) was 7 percent. At the same time, 12.9 percent of Americans with disabilities were jobless and seeking work (not seasonally adjusted).

Jobs remained comparatively hard to find in June. Last month, the underemployment rate equaled 12.1 percent, down from the 14.2 percent rate logged a year ago. Among unemployed workers, 32.8 percent had been jobless for at least six months, as opposed to 36.9 percent a year earlier, and the average spell of unemployment equaled 33.5 weeks, down from 35.7 weeks in May 2013.

In June, the leading cause of unemployment remained a job loss or the completion of a temporary job, which was the reason cited by 51.2 percent of unemployed persons. Another 28.5 percent of unemployed persons were re-entrants to the labor market, while 11.2 percent were new entrants. Voluntary job leavers accounted for the remaining 9 percent of the total.

“The June employment report painted a portrait of a national job market that is showing improvements but remains far from healed,” observed Quinterno. “The magnitude of the problems stemming from the ‘Great Recession’ combined with the painfully prolonged recovery have obscured just how unusual current conditions are and have created a distorted picture of what a robust job market would look like.”