Outlook Good: Expert Says U.S. Economy Doing Well Despite Uncertainties

Interest rates are likely to go up, oil prices are likely to increase a bit and then stabilize, and the overall U.S. economy is fairly strong – provided the federal government stops being dysfunctional.

That was the word from Gregory Miller, the chief economist at SunTrust Bank, at the Chapel Hill-Carrboro Chamber of Commerce’s annual Economic Outlook Briefing Thursday morning.

The big concern right now: will the Fed raise interest rates? This month officials dropped the word “patience” in their report, which signals a possible increase around June. Some economists worry that could slow economic growth, but Miller says it’s important to remember that interest rates are historically low right now.

“Rising rates are not the same as high rates,” he says. “We have a long, long way to go to get to high interest rates.”

And he says a hike in interest rates could actually boost the economy in the short term – since it’ll lead investors to borrow money quickly, to avoid higher rates in the future.

Generally speaking, Miller says the overall U.S. economy is doing well – especially relative to the rest of the world. That means a strong dollar, which means lower prices for Americans at the stores.

Miller says the American economy is growing at a rate of about 2.4 percent. Economists say a 3-percent growth rate is needed to keep up with increasing job demands – but Miller says the private sector is actually already doing that well. What’s holding the economy back? He says the federal government is simply failing to pull its weight.

“The government’s started to come back,” he says. “State and local governments are already back – the federal government is the only one that’s (still) moving in the wrong direction.

“We suspect that through this year, the (federal) government should start to make a positive contribution to growth. If they do that, then the whole economy (will be) doing 3 percent – and everybody’s happy.”

Miller delivered his economic outlook briefing to a group of about 200 local business leaders and elected officials Thursday at the Friday Center. It was an optimistic outlook, in general – but he did say the positive trends could be jeopardized by increasing instability.

That could come globally if there is conflict or if other national economies collapse – or it could come domestically, when election season rolls around next year.

“When we are headed toward elections, the markets and the economy tend to turn uncertain,” Miller says.

So expect a possible slowdown next year – but until then, Miller says the overall picture is good.


Higher Education Contributes Over $60 Billion to NC

Higher Education Institutions across North Carolina contribute over $60 billion to the state’s economy, according to a new study.

Don Hobart, Associate Vice Chancellor for Research at UNC, says the flagship university’s impact on the economy is felt across the Tar Heel state.

“UNC-Chapel Hill actually represents around $7.1 billion. That’s both the university and the hospital and faculty positions here,” he says. “It’s fair to say that UNC-Chapel Hill is really a powerhouse, in terms of its economic impact and its significance to the economy, in North Carolina.”

Hobart says a variety of factors were considered to reach the $7 billion impact.

“The economic impact of the university’s operations, the research spending that it does, the construction activity that takes place,” he says. “[The study] also looked at spending that was brought to the state. And then a portion of that activity was the impact of the UNC Health Care Medical Center.

He says this speaks to the value of the research being done at Carolina.

“We’ve got doctors who are discovering cures for diseases. We’ve got people inventing techniques to improve the quality of materials in products,” he says. “This study looks specifically at what the economic impact, within North Carolina, of having that type of research activity occurring would be.

“The added income to North Carolina’s economy that results from this research activity is close to $1 billion, annually.”

The economic impact report was released on Wednesday; the same day that a Board of Governor’s committee recommended cutting three centers and institutes from the University System. Hobart says this study shows the work these centers do has a positive impact on society and the economy.

“One of the valuable things that comes out of this analysis, is that it certainly validates the emphasis that the university has placed on centers and institutes,” he says. “The research centers, here on campus, are a major part of our effort to translate the work that gets done in labs and the classroom out into the economy.”

He adds this is one area that is a safe investment.

“Spending on higher education is an example of the spending of taxpayer dollars that actually pays the state treasury back,” he says.

According to UNC’s website, the state budget allots nearly $2.5 billion to fund the 17-campus University System.

Overall, the study found that the UNC System had an economic impact of nearly $28 billion in added state income. The entire higher education system – community colleges, private institutions, and the UNC System – in the state contributes $63.5 billion. That is an equivalent of just over 1,000,000 jobs.

For comparison’s sake, agriculture – the largest industry in North Carolina’s economy – contributes nearly $78 billion to the state economy, according to Department of Agriculture Spokesperson Brian Long. He adds that is an estimated 17 percent of the gross state income.


Unemployment In Orange County Hits Six-Year Low

Orange County’s unemployment rate dropped below 4 percent in November, for the first time in more than six years.

That’s according to the latest data from the NC Department of Commerce. Orange County’s unemployment rate dropped slightly, from 4 percent in October to 3.9 percent last month. It had previously hit 4 percent this past April before rising again in the summer; the last time our unemployment rate was this low was in April of 2008, just before the Great Recession.

See a graph of Orange County’s monthly unemployment rate dating back to 1990.

The numbers are not seasonally adjusted, so it’s better to compare from year to year rather than month to month. Last November, Orange County’s unemployment rate was 4.4 percent; it’s dropped by half a percentage point in the last 12 months.

Statewide, there are three counties with unemployment rates below 4 percent: Orange, Chatham, and Buncombe. Chatham has the lowest rate, 3.7 percent; Graham County still has the highest rate, 11.4. (Graham is one of two counties with a double-digit unemployment rate; the other is Scotland County.)

According to the DOC, there are 2,840 unemployed Orange County residents – but that number does not include people who are underemployed, people whose unemployment benefits have expired, or people who have dropped out of the workforce entirely.

The statewide unemployment rate for December is due out on January 27.


Downtown Chapel Hill Businesses Continue to Evolve

Downtown Chapel Hill has seen a lot of things change over the years and that is continuing with new businesses coming into the area.

Kristen Smith, with the Chapel Hill-Carrboro Chamber of Commerce, says she is anxious to see where the changes in downtown Chapel Hill lead.

“I think downtown is evolving. And that’s what makes it exciting,” she says.

She adds that many businesses view downtown as a place they can thrive, and it is important to find the right pieces to complete the puzzle.

“Downtown is so desirable, these spaces don’t stay empty,” she says. “It’s just about finding the right mix.”

Smith points out that there are already areas of downtown where you can see the evolution as businesses revamp certain locations.

“Graham Street has transformed,” she says. “We’re seeing new businesses, and I hope that people take an opportunity to get involved.”

Chapel Hill Mayor Mark Kleinschmidt says that overall there is a very low retail vacancy rate in Chapel Hill, but adds turnover is important to continue pushing the economic climate in the right direction and find businesses that can plant long-term roots in the area.

“A healthy downtown, or a main street, is going to have a fractional vacancy rate,” he says. “So that you can continue to freshen the mix of retail options for consumers.”

Smith says the possibility exists of, literally, building up in downtown. She adds that as certain developments grow taller that will open more possibilities of living space in downtown Chapel Hill. The extra population could turn into high retail foot traffic and add another layer of economic input to those downtown businesses.

“Downtown Imagined” has grown out of the “Rosemary Imagined” project. More information about all of the undertakings in development for downtown Chapel Hill can be seen on the Town of Chapel Hill webpage.


Orange Unemployment Drops Again In October

Orange County’s unemployment rate saw another big drop in October, down to 4.0 percent from 4.5 percent in September.

That’s according to numbers released earlier this week by the Labor and Economic Analysis Division of the NC Department of Commerce.

Orange County is tied with Buncombe and Henderson Counties with the second-lowest unemployment rate in the state. Chatham County has the lowest rate, at 3.8 percent. (The highest rate is Graham County, 11.2 percent.)

Numbers are not seasonally adjusted, so it’s actually more useful to compare unemployment rates from year to year rather than month to month. Orange County’s unemployment rate in October of last year was 4.8 percent – so it’s dropped almost a full point in the last 12 months.

The next update will take place next Friday, December 19, when the Department of Commerce will release state-wide unemployment numbers for November.


Here’s How To Help Orange County Residents Find Jobs

You can do your part to help local residents at risk of homelessness – by giving them a chance to find work.

Orange County’s Community Empowerment Fund has a Job Partners Program, which offers job training to local residents and connects them with potential employers.

Right now they’re looking for volunteers to serve as Employer Liaisons – working to build relationships with employers and connect graduates of the program with job openings.

If you’re interested in volunteering, there will be a training session on Wednesday, December 10, from 5:30-6:30 pm at the Community Empowerment Fund office at 133 1/2 E. Franklin Street, just east of Columbia Street in downtown Chapel Hill.

For more information, or to sign up, contact the Community Empowerment Fund at 919-200-0233.


Big Drop In Local Unemployment Rate

The unemployment rate dropped sharply in the Triangle last month, according to numbers released last week by the NC Department of Commerce.

In Orange Count, the unemployment rate dropped from 5.4 percent in August to 4.5 percent in September – almost a full percentage point in a single month. That’s no surprise – the numbers are not seasonally adjusted, and Orange County’s unemployment rate usually goes up in the summer and down again in the fall – but the 4.5 percent rate is also down 0.2 percent from where it was in September of 2013.

Alamance, Chatham, Durham, and Wake Counties also saw big drops in their unemployment rates from August to September – drops ranging from 0.7 percent to 1.1 percent, all in a single month. And all four counties also have lower unemployment rates in 2014 than they did at this time last year; Alamance County’s rate is down more than a full percentage point from September 2013 (down from 7.2 percent last year to 5.9 percent this year).

Read the full report, from the DOC’s Division of Employment Security.

Across the state, Chatham and Currituck Counties are tied with the lowest unemployment rate, 4.2 percent. Graham County has the highest, 12.2 percent.


Unemployment Down In NC (But So Is Employment)

North Carolina’s unemployment rate dropped a tenth of a point in September, from 6.8 percent in August to 6.7 percent, according to numbers released earlier this week by the North Carolina Department of Commerce.

The number of unemployed North Carolinians dropped by about 4,500 people in September – but that’s not necessarily translating into more jobs. In fact the number of employed North Carolinians also dropped in September, by about 5,600 people.

And North Carolina’s unemployment rate continues to lag behind the national average. In March of this year, the state’s unemployment rate had dropped to 6.3 percent, actually below the national rate of 6.7 – but since then, the national rate has dropped to just below 6 percent, while the state’s rate has slightly increased.

Read the full report from the NC Department of Commerce.

Still, unemployment is much lower in North Carolina now than at this time last year. The state’s unemployment rate in September 2013 was 7.7 percent – a full point higher than it is now.

County-by-county unemployment numbers are due to be released on Wednesday.


Unemployment Up Slightly In Orange

Orange County’s unemployment rate ticked up again last month, from 5.3 percent in July to 5.4 percent in August.

That’s the latest from the State Department of Commerce. According to numbers released Wednesday, the unemployment rate went up in August in 74 of North Carolina’s 100 counties.

County numbers are not seasonally adjusted, so it’s better to compare the unemployment rate from year to year rather than month to month. The August 2014 unemployment rate of 5.4 percent is still lower than it was one year ago, but not by much: in August of 2013, Orange County’s unemployment rate was 5.5 percent.

Orange County has the seventh lowest unemployment rate in the state; Currituck County is tops with a rate of 4 percent, followed by Chatham County at 4.9 percent. (Graham County ranks last with a rate of 13.4 percent.) The overall unemployment rate in the Triangle is 5.7 percent.

Statewide unemployment numbers for September will be released on October 21.


UNC Student Project Goes “Whole Hog”

(Image via PoweringANation.org.)

A UNC student-run organization called “Powering A Nation” has unveiled its newest documentary project: “Whole Hog,” an online multimedia exploration of North Carolina’s complex hog industry.

The hog industry is central to the state’s economy, particularly in eastern North Carolina where the tobacco industry is in decline. But it also comes with pitfalls, ranging from the environmental (health issues raised by the spraying of hog waste onto farms as fertilizer) to the economic (the decreasing power of individual small farmers as the industry grows more and more consolidated into fewer and fewer hands).

Available online at WholeHogNC.org, the “Whole Hog” project consists of “written pieces, video stories and graphic design elements” created by six UNC fellows. “Powering A Nation” has been active for six years, creating projects like this that examine various aspects of the energy issue in America – but editor-in-chief Kelly Creedon says this is the first of their projects with a North Carolina-specific focus.

Kelly Creedon, design editor Grayson Mendenhall, managing editor Jess Clark, and graphics editor Bailey Seitter joined Aaron Keck in WCHL studios to discuss the project, a day after its online launch.

You can experience “Whole Hog” for yourself at WholeHogNC.org – and learn more about “Powering A Nation” at PoweringANation.org.