New NC jobs data: Local labor markets shrink across state as people still face barriers to work

More people are looking for work than before COVID-19, but obstacles to rejoining the labor force continue to slow recovery

RALEIGH (June 30, 2021) — More than a year of the COVID-19 pandemic has created enormous hardship that continues to frustrate people’s ability to rejoin the workforce. More people are looking for work than before the pandemic, but many communities have also seen their labor forces shrink over the past several months. This combination of facts shows the ongoing consequences of a generational crisis, which is making it difficult for families and communities hit the hardest to recover.

“For a lot of working families that burned through all of their resources just trying to cope with the pandemic, barriers like child care, transportation, and training — along with a lack of jobs — are still making it incredibly hard to find work,” said Patrick McHugh, Research Manager with the North Carolina Budget & Tax Center. “We’re also seeing this at the community level as well. Many of the more rural counties are further from full recovery than the population centers like Wake County.”

According to new labor market data from May 2021, economic challenges facing North Carolina include:

  • More people looking for work in nearly every North Carolina community: Businesses’ challenges in finding employees is not rooted in a lack of people wanting to work. Figures show more residents were trying to find work in May 2021 than before COVID-19 in 94 of 100 North Carolina counties, every major metropolitan area, and most smaller cities.
  • Shrinking local labor forces show barriers continue to prevent people from working: The labor force (the number of people working or looking for work) is lower than it was before COVID-19 in 94 of North Carolina’s 100 counties. Perhaps even more worrisome, the majority of counties have seen their labor force decrease during 2021. Most counties have seen employment increase since January of this year, but at the same time people are being prevented from looking for work by a variety of factors, such as a lack of child care, inadequate transportation, and lacking the training needed for jobs that are available. These barriers continue to create hardship for families and employers alike as they slow our state’s road to recovery.
  • Economic divide between biggest cities and rest of the state appears to be deepening: The recovery is further along in some of North Carolina’s largest metropolitan areas such as Charlotte and Raleigh, but many other parts of the state are still much further from full recovery. Metropolitan areas that have experienced the worst declines compared to February 2020 include Goldsboro (-6.0%), Asheville (-6.9%), and Greensboro-High Point (-5.2%). By comparison, Raleigh is only 2.2% below pre-COVID employment levels. Many of the smaller cities in North Carolina have also seen a larger drop in the number of residents who report being employed than some of the more populous parts of the state. Of the 24 smaller cities where local unemployment data is reported, all but 4 have experienced a larger decline in the share of residents working than Wake County.

  • COVID-19 has either erased all employment gains or deepened losses since the start of the Great Recession in a majority of counties: In North Carolina, 56 of 100 counties had fewer people working in May 2021 than before the Great Recession. Many parts of the state had never recovered all of the jobs that disappeared in the Great Recession, so the losses during COVID-19 are further compounding a long-term problem.

For charts showing the most recent labor data and COVID-19 job data, visit the Budget & Tax Center’s Labor Market page at www.ncjustice.org/labormarket.

For more context on the economic choices facing North Carolina, check out the Budget & Tax Center’s Prosperity Watch report.

The nonpartisan Budget & Tax Center is a project of the NC Justice Center, which works to eliminate poverty in North Carolina by ensuring every household in the state has access to the resources, services and fair treatment it needs to achieve economic security. 

FOR MORE INFORMATION, CONTACT Patrick McHugh, Budget & Tax Center Research Manager, at patrick.mchugh@ncjustice.org or 919-856-2183; or Mel Umbarger, Budget & Tax Center Senior Communications Specialist, at mel@ncjustice.org.