News Releases

01.06.2012 News Releases, Policy Points No Comments

National Labor Market Goes Nowhere In May

CHAPEL HILL (June 1, 2012) – The national labor market experienced few changes in May, as employers added just 69,000 more payroll positions than they eliminated. Furthermore, the unemployment rate essentially held steady at 8.2 percent. Although the national labor market started 2012 on a positive note, growth has slowed over the course of the year.

“May marked the 20th consecutive month of job growth in the United States,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Over the past three months, the economy has netted an average of 96,300 jobs per month, a pace that, while positive, is well below the average pace of job growth recorded during the prior three-month period. The current rate of growth simply is insufficient to drive unemployment down to normal levels anytime soon.”

In May, the nation’s employers added 69,000 more payroll positions than they cut. Gains occurred entirely in the private sector (+82,000), while government payrolls fell by 13,000 positions. Additionally, the payroll employment numbers for March and April underwent negative revisions; with the updates, the economy gained 220,000 jobs over those two months, not the 269,000 positions previously reported.

Payroll levels in most major private-sector industry groups grew or held steady in May. Trade, transportation, and utilities netted the most positions (+54,000, with 65.9 percent of the growth occurring in the transportation and warehousing subsector), followed by education and health services (+46,000, with the health care subsector responsible for 71.3 percent of the net gain). Meanwhile, construction shed the most positions (-28,000 positions, with specialty trade contractors accounting for 63.2 percent of the losses.)

“The American economy has added jobs steadily for almost two years and has netted 823,000 positions so far in 2012,” noted Quinterno. “The current average rate of job growth—164,600 positions per month—nevertheless is insufficient to close the large jobs gap facing the United States.”

Weak employment conditions were evident in the May household survey. Last month, 12.7 million Americans (8.2 percent of the labor force) were jobless and seeking work. The number of unemployed Americans and the unemployment rate basically held steady last month. Meanwhile, the size of the labor force increased by 642,000 persons, and the share of the population participating in the labor force rose to 63.8 percent. Yet despite a modest increase (to 58.6 percent), the share of the adult population with a job remained at a depressed level.

Last month, the unemployment rate was higher among adult male workers than female ones (7.8 percent versus 7.4 percent). Unemployment rates were higher among Black (13.6 percent) and Hispanic workers (11 percent) than among White ones (7.4 percent). The unemployment rate among teenagers was 24.6 percent. Moreover, 7.8 percent of all veterans were unemployed; the rate among recent veterans (served after September 2001) was 12.7 percent.

Jobs remained scarce in May. Last month, the underemployment rate equaled 14.8 percent. Among unemployed workers, 42.8 percent had been jobless for at least six months with the average spell of unemployment lasting for 39.7 weeks. The leading cause of unemployment remained a job loss or the completion of a temporary job, which was the reason cited by 55 percent of unemployed persons in May.

“While the American economy continued to add jobs in May, the labor market is not growing as rapidly as occurred earlier in the year,” observed Quinterno. “Whether this slowing is the product of softening economic conditions or mild winter weather that pulled hiring forward is a topic for analysis. The bottom line remains that American workers are attempting to navigate a labor market that is not adding jobs in the numbers needed to accommodate all those who want and need work.”

18.05.2012 News Releases, Policy Points No Comments

No “Springing Forward” For NC’s Labor Market

CHAPEL HILL (May 18, 2012) – The change in seasons was not accompanied by improvements in North Carolina’s labor market. Payroll employment levels essentially were flat in April and were only slightly higher than was the case a year ago. While the unemployment rate fell to the lowest level recorded since early 2009, the drop stemmed from a decline in the size of the state’s labor force, not an increase in employment. These findings come from new data released by the Labor and Economic Analysis Division of the NC Department of Commerce.

“Job growth in North Carolina has slowed steadily over the course of 2012,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Compared to last December, North Carolina has 25,900 more jobs, but 85 percent of that gain occurred in January. Over the last two months, North Carolina has essentially netted no new jobs.”

In April, North Carolina employers cut 1,300 more payroll jobs than they added (+/- 0 percent). Private sector payroll levels essentially held steady, (-1,200, +/- 0 percent), as was the case in the public sector (-100, +/- 0 percent). Within the private sector, manufacturing shed the most jobs, (-2,900, -0.7 percent), followed by information (-1,100, -1.6 percent) and other services (-900, -0.6 percent). Professional and business services netted the most jobs (+3,600, +0.7 percent), due mainly to hiring in the administrative and waste management subsector.

A positive revision to the March payroll data found that the state lost 500 fewer jobs than first reported (-800 versus -1,300). With that revision, North Carolina now has, on net, 218,600 fewer payroll positions (-5.2 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 4,142 payroll jobs per month, resulting in a cumulative gain of 107,700 positions (+2.8 percent).

“Over the past few years, North Carolina has managed to close some of the job gap caused by the recent recession,” noted Quinterno. “Since last July, the job gap has fallen by a full percentage point, yet compared to December 2007, North Carolina has fewer payroll jobs in every major private industry sector except for educational and health services and professional and business services. The improvements that have occurred have occurred very slowly.”

The household data for April also point to a labor market characterized by widespread joblessness. Last month saw a small increase in the number of employed individuals (+1,471, <0.1 percent) and a decline in the number of unemployed persons (-12,686, -2.8 percent). Yet the size of the labor force decreased by 11,215 individuals (-0.2 percent). It was this decline rather than an increase in employment that pushed the statewide unemployment rate down to 9.4 percent, the lowest level recorded in over three years.

To place the scale of unemployment in context, consider how there were almost twice as many unemployed North Carolinians in April 2012 as there were in December 2007. The statewide unemployment rate also was 4.4 percentage points greater than it was over four years ago. In fact, the monthly statewide unemployment rate has exceeded 10 percent in 35 of the last 40 months. Moreover, the share of the adult population with a job remains at a depressed level.

“While North Carolina’s job market began 2012 moving in a positive direction, it has failed to maintain that momentum,” observed Quinterno. “The state has experienced virtually no net job growth over the last two months. While the unemployment rate has fallen by half a percentage point since February, the decline is due largely to people leaving the labor force. Recovery remains a distant goal for jobless North Carolinians—a goal that still is being measured in terms of years.”

04.05.2012 News Releases, Policy Points No Comments

National Labor Market Cools In April

CHAPEL HILL (May 4, 2012) – The national labor market cooled in April, as employers added just 115,000 more payroll positions than they eliminated. The unemployment rate, meanwhile, essentially held steady at 8.1 percent with unemployment rates among major demographic groups largely remaining unchanged. While the national labor market started 2012 on a positive note, growth has slowed over the course of the year.

“April marked the 19th consecutive month of job growth in the United States,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Over the past four months, the economy has netted an average of 132,000 jobs per month, a pace that, while positive, is simply not enough to drive unemployment down to normal levels anytime soon.”

In April, the nation’s employers added 115,000 more payroll positions than they cut. Gains occurred entirely in the private sector (+130,000), while government payrolls fell by 15,000 positions due primarily to cuts by local governments. Additionally, the payroll employment numbers for February and March underwent revisions; with the updates, the economy gained 413,000 jobs over those two months, not the 360,000 positions previously reported.

Employment levels in most major private-sector industry groups grew or held essentially steady in April. Professional and business services netted the most positions (+62,000, with 52.1 percent of the growth occurring in the administrative and waste services subsector), followed by education and health services (+23,000, with the health care subsector responsible for 82.6 percent of the net gain), and trade, transportation, and utilities (+22,000, due overwhelmingly to gains in the retail trade subsector). Meanwhile, the construction, information, and other services sectors shed the most positions (all -2,000).

“The American economy has added jobs steadily for a little more than 1.5 years and has netted 528,000 positions so far in 2012,” noted Quinterno. “The current pace of job growth is nevertheless modest relative to the size of the overall jobs gap, and, alarmingly, growth has slowed over the course of the year. A return to normal labor market conditions remains a distant goal, absent more attention and support from policymakers.”

Weak employment conditions were evident in the April household survey. Last month, 12.5 million Americans (8.1 percent of the labor force) were jobless and seeking work. The number of unemployed Americans and the unemployment rate basically held steady last month, while the size of the labor force fell (-342,000), as did the share of the population participating in the labor force (to 63.6 percent). Moreover, the share of the adult population with a job (58.4 percent) remained at a depressed level.

Last month, the unemployment rate was higher among adult male workers than female ones (7.5 percent versus 7.4 percent). Unemployment rates were higher among Black (13 percent) and Hispanic workers (10.3 percent) than among White ones (7.4 percent). The unemployment rate among teenagers was 24.9 percent. Moreover, 7.1 percent of all veterans were unemployed; the rate among recent veterans (served after September 2001) was 9.2 percent.

Jobs remained difficult to find in April. Last month, the underemployment rate equaled 14.5 percent. Among unemployed workers, 41.3 percent had been jobless for at least six months with the average spell of unemployment lasting for 39.1 weeks.

“The April employment report shows that the American economy is continuing to add jobs, though not as rapidly as is needed or was the case earlier in the year,” observed Quinterno. “The April employment report illustrates both how far the national labor market has come since the depths of the recession and just how far it still must go before reaching healthy levels of economic activity.”

20.04.2012 News Releases, Policy Points No Comments

Payrolls Flat, Unemployment Down In March

CHAPEL HILL (April 20, 2012) – Payroll employment levels in North Carolina held steady in March, while the statewide unemployment rate fell to the lowest level recorded over the last three years. Despite the overall growth in payrolls and the drop in unemployment posted during the first quarter of 2012, unemployment remains elevated, and the current rate of job growth is unlikely to close the state’s sizable job gap anytime soon. These findings come from new data released by the Labor and Economic Analysis Division of the NC Department of Commerce.

“During the first three months of the year, North Carolina employers added 26,700 more jobs than they cut, which helped push down the unemployment rate to the lowest level seen in three years,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Compared to last December, North Carolina has more jobs, a larger labor force, more employed persons, fewer unemployed individuals, and a lower unemployment rate. The share of the adult population with a job, though still extremely depressed, also rose during the first part of the year.”

In March, North Carolina employers cut 1,300 more payroll jobs than they added (+/- 0 percent). Private sector payroll levels essentially held steady, (-300, +/- 0 percent), while the public sector eliminated 1,000 more positions than it gained (-0.1 percent), due chiefly to reductions by state government. Within the private sector, construction shed the most jobs, (-2,900, -1.7 percent), followed by professional and business services (-1,300, -0.3 percent), and other services (-800, -0.5 percent). Financial activities netted the most jobs (+1,600, +0.8 percent), followed by leisure and hospitality services (+1,300, +0.3 percent), and trade, transportation, and utilities (+1,000, +0.1 percent).

A negative revision to the February 2012 payroll data found that the state gained 2,200 fewer jobs than first reported (+6,100 versus +8,300). With that revision, North Carolina now has, on net, 217,800 fewer payroll positions (-5.2 percent) than it had in December 2007. Since bottoming out in February 2010, the state has netted an average of 4,340 payroll jobs per month, resulting in a cumulative gain of 108,500 positions (+2.8 percent).

“Over the past two years, North Carolina has managed to close some of the job gap caused by the recent recession,” noted Quinterno. “Since last July, the job gap has fallen by a full percentage point, yet when compared to December 2007, North Carolina still has fewer payroll jobs in every major private industry sector except for educational and health services and professional and business services. A full labor market recovery remains a distant goal.”

The household data for March also point to a labor market that is far from robust. Positive developments included a small increase in the number of employed individuals (+4,240, +0.1 percent), a decline in the number of unemployed persons (-12,092, -2.6 percent), and a drop in the unemployment rate to 9.7 percent, the lowest level recorded over the past three years.

Nevertheless, joblessness remained widespread in March. There were almost twice as many unemployed North Carolinians in March 2012 as there were in December 2007, and the statewide unemployment rate was 4.7 percentage points greater than it was some four years ago. In fact, the monthly statewide unemployment rate has exceeded 10 percent in 35 of the last 37 months. Moreover, the size of the state’s labor force fell by 7,852 individuals (-0.2 percent) in March.

“Despite the improvements recorded during the first quarter of 2012, North Carolina’s labor market remains in fragile condition,” cautioned Quinterno. “Particularly worrisome is the fact that payroll employment growth slowed over the quarter, with each month’s statistics slightly worse than the ones from the preceding month. In no way are recent improvements signs that all is well in the labor market.”

10.04.2012 News Releases, Policy Points No Comments

Two Decades Of Cuts To Public Higher Education

CHAPEL HILL (April 10, 2012) – Since 1990, state governments have steadily disinvested in the nation’s public four-year and two-year institutions of higher learning. These reductions have resulted in a major shifting of the cost of higher education from states as a whole to individual students in the form of escalating tuition charges—charges that students and their families increasingly are struggling to pay.

These findings come from a new report entitled “The Great Cost Shift: How Higher Education Cuts Undermine The Future Middle Class.” Commissioned by Demos, a national public policy organization based in New York City, the report was prepared by South by North Strategies, Ltd., a research firm in Chapel Hill, North Carolina, that specializes in economic and social policy.

“Since 1990, states as a whole have disinvested in their public colleges and universities and in the process have transformed how public higher education is financed,” said the report’s principal author, John Quinterno of South by North Strategies. “The result has been a shifting in the cost of higher education to students and their families. Compared to prior generations of college students, young adults who have reached college age since 2000 have increasingly been left to their own devices.”

Key findings from the report include the following:

  • Public institutions have played an important role in serving the growing numbers of undergraduate students. Public institutions absorbed 65.6 percent of the undergraduate enrollment increases that have occurred since 1990.
  • After controlling for inflation, states collectively invested in higher education $6.12 per $1,000 in personal income in 2010-2011, down from $8.75 in 1990-1991, despite the fact that personal income increased by 66.2 percent over that period.
  • Over the past 20 years, there has been a breakdown in the historical funding pattern of recessionary cuts and expansionary rebounds. The length of time for higher education funding to recover following recessions has lengthened for every downturn since 1979 with early evidence suggesting that the recovery from the Great Recession will be no different.
  • Between 1990-1991 and 2009-2010, published prices for tuition and fees at public four-year universities more than doubled, rising by 112.5 percent, after adjusting for inflation, while the real price of two-year colleges climbed by 71 percent.
  • Median household income in the United States in 2010 was just 2.1 percent higher than in 1990.

“When we turn our back on higher education, we turn our back on the future of the middle class in America,” said Viany Orozco, Senior Policy Analyst at Demos, who oversaw the development of the report. “State and federal legislators need to recognize that our future workforce will demand a higher education degree; a college degree is not a privilege, it is a necessity.”

“Despite its long history of support for community colleges and public universities, North Carolina has not been immune to the wave of disinvestment that has swept across the nation since 1990,” explained Quinterno. “After adjusting for inflation, the state’s investment of its own funds in higher education amounted to $11.51 per $1,000 in personal income in 2010-2011, down from $13.64 in 1990-1991.”

“The decline in North Carolina’s investment occurred despite the fact that inflation-adjusted personal income in the state grew by 90 percent over the past 20 years,” added Quinterno. “Simply put, North Carolina has become a richer state that is investing less of its wealth in the institutions that help individuals secure a place in the middle class and help fuel the state’s long-term economic prosperity.”

The report calls for renewing America’s commitment to nurturing a strong and inclusive middle class through investments in public higher education. It underscores that states have the capacity to invest more, for despite the budget challenges of recent years, every state is wealthier than it was 20 years ago.

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In conjunction with the Demos report, the North Carolina Budget and Tax Center in Raleigh released a companion report that applies the methodology to more detailed data for North Carolina. That analysis is available here.