Prosperity Watch Issue 46, No. 1: The U.S. has come back faster than North Carolina

For the first time in a generation, North Carolina employment growth has not kept up with the nation since the start of the last recession. Having just passed the seven year mark from the start of the Great Recession, this is a good time to think about how North Carolina’s performance has fared compared to the nation, and compared to other recoveries in recent memory. As can be seen in the chart below, we are falling short of the mark.

The employment data shown here underscore two important facts. First, the last two recoveries have been extremely weak by historical standards. Seven years on, State and national employment has grown by less than 2% compared to where we were before the start of the Great Recession. During the growth period of the 1990’s, State and national employment had surpassed pre-recession levels by more than 10%. Second, this is the first time in decades that North Carolina has not outperformed the nation during good economic times. North Carolina outpaced the nation by 10 percentage points during the 1980’s, 5 points during the 1990’s, and almost 2 points during the 2000’s. During the current recovery however, North Carolina has fallen just short of national employment growth.

Looking at these data, it is clear that North Carolina is not living up to its legacy of strong economic growth. This is particularly surprising and troubling given North Carolina’s rapid population growth over the last decade, which should be driving increased demand and employment. The combination of expanding population and anemic employment growth spells trouble for the future of prosperity in North Carolina.