Policy Points

10.04.2013 News Releases, Policy Points No Comments

Unemployment Widespread In Local Labor Markets

CHAPEL HILL, NC (April 10, 2013) – Between February 2012 and February 2013, unemployment rates fell in 76 of North Carolina’s 100 countries and in 12 of the state’s 14 metropolitan areas. Over the period, the size of the labor force grew in 46 counties and in 10 metro areas. These findings come from new estimates prepared by the Labor and Economic Analysis Division of the North Carolina Department of Commerce.

“Over the year, local unemployment rates dropped across most of North Carolina,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Unemployment nevertheless remained widespread. Last month, local unemployment rates equaled or exceeded 10 percent in 60 counties and 4 metro areas. In February 2008, in contrast, five counties and no metro areas logged unemployment rates of 10 percent or greater.”

Compared to December 2007, which is when the national economy fell into recession, North Carolina now has 2.9 percent fewer jobs (-118,300) and has seen its unadjusted unemployment rate climb to 9.5 percent from 4.7 percent. In February, the state added 3,300 more jobs than it lost (+0.1 percent). Since bottoming out in February 2010, the state’s labor market has netted some 5,819 jobs per month, resulting in a cumulative gain of 209,500 positions (+5.5 percent).

Between January 2012 and February 2013, local unemployment rates declined in 99 of the state’s 100 counties. Individual county rates ranged from 5.9 percent in Orange County to 20.2 percent in Graham County. Overall, 60 counties posted unemployment rates greater than or equal to 10 percent, and 39 counties posted rates between 6.8 and 9.9 percent.

“Non-metropolitan labor markets continue to struggle relative to metropolitan ones,” noted Quinterno. “In February, 10.9 percent of the non-metro labor force was unemployed, compared to 9 percent of the metro labor force. Compared to December 2007, the non-metro labor force now has 6.7 percent fewer employed persons, while the number of unemployed individuals is 94.1 percent larger.”

Over the month, unemployment rates fell in all 14 metro areas. Rocky Mount had the highest unemployment rate (13.2 percent), followed by Hickory-Morganton-Lenoir (10.8 percent) and Wilmington (10.2 percent). Durham-Chapel Hill had the lowest unemployment rate (7 percent), followed by Raleigh-Cary (7.5 percent) and Asheville (7.8 percent).

Compared to February 2012, unemployment rates in February 2013 were lower in 76 counties and 12 metro areas. Over the year, labor force sizes increased in 46 counties and in 10 metros. Among metros, Asheville’s labor force expanded at the fastest rate (+2.6 percent), followed by that of Greenville (+2.4 percent). With those changes, metro areas now are home to 71.8 percent of the state’s labor force, with 50.4 percent of the labor force residing in the Triangle, Triad, and Charlotte metros.

In the long term, improvements in overall labor market conditions will hinge on growth in the Charlotte, Research Triangle, and Piedmont Triad regions. Yet growth in these metros remains subdued. Collectively, employment in those three metro regions has risen by 2.5 percent since December 2007, and the combined February unemployment rate in the three regions equaled 8.5 percent. That was down from the 9.1 percent rate recorded one year ago yet was well above the 4.9 percent rate recorded in February 2008. Of the three broad regions, the Research Triangle had the lowest February unemployment rate (7.5 percent), followed by Charlotte and the Piedmont Triad (both 9.6 percent).

“Three years into a statewide labor market recovery, unemployment remains widespread across much of North Carolina,” said Quinterno. “The state simply lack enough jobs for all those who need and want work, and little evidence suggests that the pattern is about to change anytime soon.”

05.04.2013 News Releases, Policy Points No Comments

National Labor Market Stumbled In March

The national labor market added in March just 88,000 more jobs than it lost in March. The unemployment rate, meanwhile, dipped to 7.6 percent, due in part to a contraction in the size of the labor force. Despite some improvements in certain key indicators in recent months, unemployment and underemployment remain elevated.

“March was the 30th-straight month of job growth recorded 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 national economy has netted an average of 168,000 jobs, a pace that, while positive, is insufficient to drive unemployment down to pre-recessionary levels. More than 3.5 years into a recovery, the unemployment rate remains well above the December 2007 level of 5 percent.”

In March, the nation’s employers added 88,000 more payroll positions than they cut. Gains occurred entirely in the private sector (+95,000), while government employers eliminated 7,000 more positions than they added, owing chiefly to reductions by the US Postal Service. Moreover, the payroll employment numbers for January and February underwent revisions; with the updates, the economy gained 416,000 jobs over those two months, not the 355,000 positions previously reported.

Within the private sector, payroll levels rose the most in the professional and business services sector (+51,000, with half of the gain attributable to the administrative and waste services subsector), followed by education and health services sector (+44,000, with 53.2 percent of the gain attributable to the health care subsector), the construction sector (+18,000), and the leisure and hospitality sector (+17,000, with 71.6 percent of the gain occurring in the accommodation and food services subsector). Payroll levels fell the most in the trade, transportation, and utilities sector (-27,000, with 89.3 percent of the losses originating in the retail trade subsector).

“Over the last year, the American economy has gained 1.9 million more payroll positions that it has lost,” noted Quinterno. “The current average monthly rate of job growth—some 159,000 positions per month—nevertheless is insufficient to fill the sizable jobs gap caused by the most recent recession.”

Slack labor market conditions were evident in the March household survey. Last month, 11.7 million Americans (7.6 percent of the labor force) were jobless and seeking work. While the unemployment rate dropped between February and March, that was due in part to a large contraction in the size of the labor force (-496,000 persons). Also in March, the share of the population participating in the labor force fell to 63.3 percent, a rate lower than the one recorded a year ago. On a somewhat positive note, more Americans were working in March compared to a year ago, while fewer persons were unemployed. At the same time, the share of the working age population with a job fell in March to a level close to the lowest one recorded during the current business cycle.

Last month, the unemployment rate was higher among adult female workers than male ones (7 percent versus 6.9 percent). Unemployment rates were higher among Black (13.3 percent) and Hispanic workers (9.2 percent) than among White ones (6.7 percent). The unemployment rate among teenagers was 24.2 percent. Moreover, 7.1 percent of all veterans were unemployed; the rate among recent veterans (served after September 2001) was 9.2 percent. At the same time, 13 percent of Americans with disabilities were jobless and seeking work (not seasonally adjusted).

Jobs remained scarce in March. Last month, the underemployment rate equaled 13.8 percent. Among unemployed workers, 39.6 percent had been jobless for at least six months, and the average spell of unemployment was 37.1 weeks. The leading cause of unemployment remained a job loss or the completion of a temporary job, which was the reason cited by 53.6 percent of unemployed persons in March. Another 26.9 percent of unemployed persons were reentrants to the labor market, while 11.1 percent were new entrants. Voluntary job leavers accounted for the remaining 8.4 percent of the total.

“In March, the air very much leaked out of the American job market,” observed Quinterno. “The monthly job gain was the smallest recorded since last June, and the economy still is not adding jobs fast enough to accommodate all the Americans who need work. And while the unemployment rate fell, that drop was due to people leaving the job market altogether.”

04.04.2013 Policy Points No Comments

NC Unemployment Claims: Week Of 3/16/13

For the benefit week ending on March 16, 2013, some 9,989 North Carolinians filed initial claims for state unemployment insurance benefits and 96,600 individuals applied for state-funded continuing benefits. Compared to the prior week, there were fewer initial 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 11,002 initial claims were filed over the previous four weeks, along with an average of 101,767 continuing claims. Compared to the previous four-week period, the average number of initial claims was lower, as was the average number of continuing claims.

One year ago, the four-week average for initial claims stood at 11,354, and the four-week average of continuing claims equaled 113,785.

In recent months covered employment has increased and now exceeds the level recorded a year ago (3.8 million versus 3.7 million). Nevertheless, there are still fewer covered workers than there were in January 2008, which means that payrolls are smaller today than they were approximately five years ago.

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

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.  Yet continuing claims remain at an elevated level, which suggests that unemployed individuals are finding it difficult to find new positions.

 

29.03.2013 Policy Points No Comments

Editor’s Note

Policy Points is taking a few days off to celebrate the Easter holiday. Regular posting will resume on April 2, 2013.

Thank you for your interest in the blog.

28.03.2013 News Releases, Policy Points No Comments

State Labor Market Drifted Through February

CHAPEL HILL, NC (March 28, 2013) – In February, employers in North Carolina added 3,300 more payroll positions than they eliminated (+0.1 percent). While the statewide unemployment rate (seasonally adjusted) fell by 0.1 percentage points in February, the decline was attributable to a contraction in the size of the labor force; in fact, fewer people held jobs in February than in January. These findings come from new data released by the Labor and Economic Analysis Division of the NC Department of Commerce.

“Payroll employment growth in North Carolina slowed to a virtual standstill in February,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Despite logging seven straight months of employment growth, North Carolina still has fewer jobs than it did in December 2007. Compared to then, payroll levels are lower in seven of the state’s ten major private industrial supersectors.”

In February, North Carolina employers added 3,300 more jobs than they cut (+0.1 percent). Private-sector payrolls netted 2,200 positions (+0.1 percent), while public-sector payrolls gained 1,100 jobs (+0.2 percent). Within the private sector, the professional and business services sector netted the most jobs (+2,600, +0.5 percent), with virtually all of the gain originating in the professional, scientific, and technical services subsector. The education and health services sector added, on net, 2,100 jobs (+0.4 percent), with health care and social services sector responsible for 66.7 percent of the gain. Meanwhile, the leisure and hospitality services sector shed the most positions (-3,000, -0.7 percent), with 83.3 percent of the losses occurring in the accommodations and food services subsector. The trade, transportation, and utilities sector lost 1,500 positions (-0.2 percent), followed by the other services sector (-600, -0.4 percent).

A revision to the January payroll data found that the state gained slightly fewer jobs than first estimated (+14,100 versus +15,100). With that revision, North Carolina now has, on net, 118,300 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 5,819 payroll jobs per month, resulting in a cumulative gain of 209,500 positions (+5.5 percent).

“The past few months have seen relatively better job growth in North Carolina, and as a result, the state has recovered some of the ground lost during the recession,” noted Quinterno. “The pace of growth, however, remains subdued, and the state still has fewer jobs than it did at the start of latest recession despite being three years into a recovery.”

The household data for February also pointed to the existence of a lackluster labor market. Last month, the number of unemployed North Carolinians fell (-6,585, -1.5 percent), but so did the number of employed persons (-4,964, -0.1 percent). The slight drop in the unemployment rate to 9.4 percent from 9.5 percent in January therefore was a product of a contraction in the size of the labor force (-11,549, -0.2 percent). In February, the share of the working-age population participating in the labor force (63.2 percent) fell after having risen in each of the prior five months.

Compared to a year ago, some 63,847 more North Carolinians held jobs in February (+1.5 percent), while 997 more persons were unemployed (+0.2 percent). Nevertheless, the unemployment rate fell by 0.1 percentage points due to the overall increase in the size of the labor force. Additionally, both the labor force participation rate and employment to population ratio increased by 0.2 percentage points over the year, though both measures remain at depressed levels.

The growth in the labor market that has occurred over the past year, however, is weak in relation to the severity of the employment problems facing the state. North Carolina’s unemployment rate has equaled or exceeded 9 percent in every month since January 2009 and has ranged as high as 11.4 percent. Over the past 14 months, the rate has fluctuated between 9.4 percent and 9.6 percent. Moreover, compared to December 2007, which was when the “Great Recession” began, the statewide unemployment rate is 4.4 percentage points higher, and the number of unemployed North Carolinians is 95.4 percent larger.

“The February employment was a fairly unimpressive one that points to a labor market that is stable but not necessarily improving in ways perceptible to the almost 447,000 North Carolinians who are jobless and seeking work,” observed Quinterno. “The bottom line is that North Carolina continues to face a sizable jobs shortfall, slow payroll growth, and widespread unemployment. In all those respects, 2013 so far is proving no different than 2012.”