MEDIA RELEASE: Jobs recovery still waiting to happen in many North Carolina metros

Drop in unemployment rate driven by workers dropping out of the labor force

RALEIGH (February 5, 2014) — Despite falling unemployment rates, most of North Carolina’s metro areas are still waiting for meaningful job creation, according to new numbers released by the Division of Employment Security this morning. In 11 of 14 of the state’s metro areas, the drop in the unemployment rate between December 2012 and December 2013 was driven by a shrinking labor force and not by large-scale employment growth. In 10 metros areas, more jobs were created from December 2011 to December 2012 than from December 2012 to 2013.

“Too many of North Carolina’s metro areas are waiting for a jobs recovery. We’re basically seeing the unemployed moving out of the labor force altogether, rather than into jobs, largely because there are just not enough available job openings,” said Allan Freyer, Public Policy Analyst with the Budget & Tax Center, a project of the NC Justice Center. “If our metros were truly seeing big improvements in unemployment, we would expect to see the number of employed people grow by the same amount that the number of unemployed people goes down. But we don’t, because the labor force is also dropping.”

Several examples include:

  • In Wilmington, less than 14 percent of the drop in unemployed people over the past year came from those workers moving into jobs, despite seeing its unemployment rate fall from 10 percent to 7.1 percent. The other 86 percent simply dropped out of the labor force altogether, due to the lack of available jobs for workers. Wilmington created 1,900 more jobs in 2012 than in 2013.
  • Although Winston-Salem saw its unemployment rate drop from 8.8 to 6.1, barely 3 percent of the drop in unemployed people over the past year came from those workers moving into jobs. The other 97 percent simply dropped out of the labor force altogether. Winston-Salem created 900 more jobs in 2012 than in 2013.
  • In Greensboro, only 16 percent of the of the drop in unemployed people over the past year came from those workers moving into jobs, despite seeing its unemployment rate fall by 2.9 points. The other 84 percent simply dropped out of the labor force altogether.
  • Although Asheville saw its unemployment rate drop 2.5 points over the last year, less than 22 percent of the drop in unemployed people came from those workers moving into jobs. The other 78 percent simply dropped out of the labor force altogether.  Asheville created 1,700 more jobs in 2012 than in 2013.
  • In Raleigh, one of the few metros that saw higher job growth in 2013 than in 2012, just over half of the drop in unemployed people over the past year came from those workers moving into jobs, despite seeing the unemployment rate fall from 7.5 percent to 5.2 percent. The other half simply dropped out of the labor force altogether, due to the lack of available jobs for workers.

The data released by the Division of Employment Security is subject to revision and should be interpreted with great caution.

FOR MORE INFORMATION, CONTACT: Allan Freyer, allan@ncjustice.org, 919.856.2151; Jeff Shaw, Director of Communications, jeff@ncjustice.org, 503.551.3615 (cell).
 

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