Policy Points

23.09.2013 Policy Points No Comments

The Arc Of Inequality In America

A new infographic from the Center for Economic and Policy Research traces the share of total income going to the top 1 percent of the American income distribution from 1913 through 2012.

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20.09.2013 News Releases, Policy Points No Comments

NC’s Labor Market Recovery Appears Stalled

CHAPEL HILL, NC (September 20, 2013) – In August, employers in North Carolina eliminated 1,700 more payroll positions than they added (+/- 0.0 percent). That drop was driven almost entirely by a net reduction of 6,400 jobs (-1.5 percent) on the part of local governments. So far in 2013, North Carolina has gained just 20,000 more jobs than it has lost (+0.5 percent), and the year is shaping up to be the worst year for job growth since the onset of the recovery.

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

“North Carolina’s labor market turned in an underwhelming performance in August,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “No progress was made in closing the state’s large job gap, as what modest growth occurred in the private sector was erased by reductions in the public sector.”

In August, North Carolina businesses shed 1,700 more jobs than they added (+/- 0.0 percent). Last month, private-sector payrolls netted 5,100 positions (+0.2 percent), but public-sector payrolls shed 6,800 jobs (-1.0 percent), due almost entirely to cuts by local governments (-6,400, -1.5 percent). Within the private sector, the professional and business services sector netted the most jobs (+3,300, +0.6 percent), with all of the gain coming from the administrative and waste management subsector. Education and health services netted 2,900 positions (+0.5 percent), followed by the trade, transportation, and utilities sector (+2,800, +0.4 percent). The leisure and hospitality sector, meanwhile, lost the most jobs (-2,800, -0.6 percent), followed by the construction (-1,700, -1 percent) and other services (-1,600, -1.1 percent) sectors.

A revision to the July payroll data found that the state gained slightly more jobs than first estimated (+8,600 versus +8,200). With that revision, North Carolina now has, on net, 115,700 fewer payroll positions (-2.8 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 5,050 payroll jobs per month, resulting in a cumulative gain of 212,100 positions (+5.5 percent).

“North Carolina experienced minimal net payroll growth during the first eight months of 2013,” noted Quinterno. “The net gain of 20,000 jobs recorded during the first two-thirds of the year is 53.7 percent smaller than the figure netted during the first eight months of 2012. For North Carolina to net as many jobs in 2013 as it did in all of 2012, the state would need to net an average of 17,475 jobs per month for the rest of the year. At no point since 1990 has the state averaged such job growth over the final third of a calendar year.”

The household data for August also pointed to the existence of a sputtering labor market. Last month, the number of unemployed persons fell (-8,741, -2.1 percent), but so did the number of employed persons (-3,562, -0.1 percent).The drop in the unemployment rate to 8.7 percent—the lowest monthly rate posted since December 2008—therefore was attributable to people leaving the labor force rather than individuals finding new positions. In fact, the size of the state’s labor force has fallen steadily since December 2012 and is now smaller than at any point since January 2012.

The ongoing slides in two major measures of labor utilization provide additional evidence of an under-performing statewide labor market. In August, the labor force participation rate fell for the seventh-consecutive month. The current rate of 61.8 percent is the lowest monthly figure recorded at any point since January 1976. Similarly, the employment-to-population ratio fell again in August to 56.4 percent, a level only slightly above the 37-year low of 56.3 percent posted in late 2011.

August’s labor market report provides additional insight into the effects of the extensive changes to the state’s system of unemployment insurance compensation implemented over the summer. While the number of unemployed persons fell by 2.1 percent in August, the number of individuals receiving state-funded insurance compensation (new and continuing claims) fell by 8.5 percent from July to August. Additionally, the number of new insurance claims fell by 16.1 percent between July and August.

“North Carolina’s labor market has turned in an utterly underwhelming performance so far in 2013,” observed Quinterno. “The overall decline in the unemployment rate is masking a number of alarming developments—developments that point to a labor market that simply is under-performing. The modest recovery that North Carolina has experienced in the wake of the most recent recession appears to be stalling out in 2013.”

19.09.2013 Policy Points No Comments

NC Unemployment Claims: Week Of 8/31/13

For the benefit week ending on August 31, 2013, some 5,700 North Carolinians filed initial claims for state unemployment insurance benefits and 76,180 individuals applied for state-funded continuing benefits. Compared to the prior week, there were fewer initial claims and fewer continuing claims. These figures come from data released by the US Department of Labor.

Averaging new and continuing claims over a four-week period — a process that helps adjust for seasonal fluctuations and better illustrates trends — shows that an average of 6,065 initial claims were filed over the previous four weeks, along with an average of 79,689 continuing claims. Compared to the previous four-week period, the average number of initial claims was lower, and the average number of continuing claims was lower.

One year ago, the four-week average for initial claims stood at 11,124, and the four-week average of continuing claims equaled 99,327.

In recent months covered employment has increased and now exceeds the level recorded a year ago (3.84 million versus 3.77 million). Nevertheless, there are still fewer covered workers than there were in January 2008, which means that payrolls are smaller today than they were more than 5.5 years ago.

The graph (right) shows the change
untitleds in unemployment insurance claims measured as a share of covered employment in North Carolina since the recession’s start in December 2007.

Both new and continuing claims appear to have peaked for this cycle, and the four-week averages of new and continuing claims have fallen considerably.  In fact, the four-week average of initial claims, when measured as a share of covered employment, is now at the lowest level recorded since early 2008. The four-week average of continuing claims also has fallen to the lowest level recorded since early 2008.

Note that the recent declines in new and continuing claims are not necessarily indicative of an improving labor market. State legislation that took effect on July 1, 2013, made major changes to insurance eligibility criteria, and the more stringent criteria eliminate claims that would have been valid prior to July 1. In time, this development also should reduce the number of continuing claims. Additionally, the legislation reduced the maximum number of weeks  of state-funded insurance for which a claimant is eligible — an action that eventually should lead to a reduction in the number of continuing claims.

To place the numbers in context, consider how the four-week average of initial claims (6,065) was 45.5 percent lower than the figure recorded one year ago (11,124), while the average number of continuing claims was  19.8 percent lower (79,689 versus 99,327). Given the relative lack of improvement in labor market condition in North Carolina over the past year, such declines likely are products of changes to unemployment insurance laws rather than improvements in underlying economic conditions.

12.09.2013 Policy Points No Comments

Job Openings In July 2013

From the Economic Policy Institute’s analysis of the July 2013 version of the Job Openings and Labor Turnover Survey (JOLTS) …

In July, the total number of job seekers, which declined by 263,000 from June, was 11.5 million (unemployment data are from the Current Population Survey and can be found here). The “job-seekers ratio”—the ratio of unemployed workers to job openings—slightly increased in July to 3.1-to-1. The ratio has been 3.0-to-1 or greater since October 2008, more than four-and-a-half years ago. A job-seekers ratio above 3-to-1 means there are no jobs for more than two out of three unemployed workers. To put today’s ratio of 3.1-to-1 in perspective, the highest the ratio ever got in the early 2000s downturn was 2.9-to-1 in September 2003. In a labor market with strong job opportunities, th

12.09.2013 Policy Points No Comments

NC Unemployment Claims: Week Of 8/24/13

For the benefit week ending on August 24, 2013, some 6,043 North Carolinians filed initial claims for state unemployment insurance benefits and 78,847 individuals applied for state-funded continuing benefits. Compared to the prior week, there were fewer initial claims and fewer continuing claims. These figures come from data released by the US Department of Labor.

Averaging new and continuing claims over a four-week period — a process that helps adjust for seasonal fluctuations and better illustrates trends — shows that an average of 6,470 initial claims were filed over the previous four weeks, along with an average of 83,110 continuing claims. Compared to the previous four-week period, the average number of initial claims was lower, and the average number of continuing claims was lower.

One year ago, the four-week average for initial claims stood at 11,307, and the four-week average of continuing claims equaled 100,277.

In recent months covered employment has increased and now exceeds the level recorded a year ago (3.84 million versus 3.77 million). Nevertheless, there are still fewer covered workers than there were in January 2008, which means that payrolls are smaller today than they were more than 5.5 years ago.

The graph (right) shows the changeuntitleds in unemployment insurance claims measured as a share of covered employment in North Carolina since the recession’s start in December 2007.

Both new and continuing claims appear to have peaked for this cycle, and the four-week averages of new and continuing claims have fallen considerably.  In fact, the four-week average of initial claims, when measured as a share of covered employment, is now at the lowest level recorded since early 2008. The four-week average of continuing claims also has fallen to the lowest level recorded since early 2008.

Note that the recent declines in new and continuing claims are not necessarily indicative of an improving labor marker. State legislation that took effect on July 1, 2013, made major changes to insurance eligibility criteria, and the more stringent criteria eliminate claims that would have been valid prior to July 1. In time, this development also should reduce the number of continuing claims. Additionally, the legislation reduced the maximum number of weeks  of state-funded insurance for which a claimant is eligible — an action that eventually should lead to a reduction in the number of continuing claims.   

To place the numbers in context, consider how the four-week average of initial claims (6,470) was 42.8 percent lower than the figure recorded one year ago (11,370), while the average number of continuing claims was  17.2 percent lower (83,110 versus 100,277). Given the relative lack of improvement in labor market condition in North Carolina over the past year, such declines likely are products of changes to unemployment insurance laws rather than improvements in underlying economic conditions.