North Carolina’s Job Recovery Remains Sluggish
North Carolina’s unemployment numbers for June were released last Friday, and the rate remained at 6.4 percent – the same as the month before.
Jobs are being added, according to economists. So why are the numbers flat?
“Now we’re seeing the flip side of what we observed before,” said Professor of Economics at UNC-Chapel-Hill Patrick Conway. “More jobs are being created, but the unemployment rate is staying the same, or maybe even going up in the past couple of months. And that’s because people who dropped out of the labor force because they couldn’t find a job and they got discouraged saw the increase in the number of hires and now they’ve come back.”
The previous situation he referred to is the period in North Carolina last year that saw unemployment drop from 8.8 percent when Republican Gov. Pat McCrory took office, to 8.1 percent in July, and steadily downward through the end of the year. It settled at 6.4 percent in May.
Conway spoke to the News & Observer’s Rob Christensen about that period for a recent commentary. In his piece, Christensen threw cold water on a Fox Business New anchor’s speculation that McCrory could run for president in 2016, by touting on that dramatic drop in the unemployment rate.
Here’s Conway again:
“What we observed was a large drop in the unemployment rate,” said Conway, “but at the same time, we observed very little growth in jobs.”
Other economists back him up on that. John Quinterno of the Chapel Hill economic research firm South by North Strategies told Bloomberg News that the labor force contracted late last year by around 95,000 people.
Conway said that people are now returning to the workforce, as defined by labor statistics. That means a lot of them are just looking for jobs again. That, said Conway, has kept the unemployment rate flat even as actual employment numbers are rising.
Then, there’s the matter of who’s even hiring these days.
“That’s been somewhat of a disappointment,” said Conway. “I can’t speak to the most recent month, but in previous months, the largest growth in employment was in jobs that pay fairly low wages – so, hospitality, or retail jobs.”
And a lot of people are taking part-time jobs, said Conway.
According to figures he supplied, the real median hourly wage in North Carolina hit its peak in 2010 at $13.20, and has declined every year since.
It’s currently at $12.87 per hour.