Behind the state's jobless numbers
Published April 2, 2014
Editorial by Burlington Times-News, March 30, 2014.
Politicians and think tanks argue as to why the state’s unemployment rate has fallen almost 3 percentage points in a year, but along with other signs of a recovery finally taking shape, a little optimism is warranted. By no means are we where we would like to be, but in comparison to a year ago (and a couple of years before that) things are looking up on the unemployment front anyway.
After several years with its unemployment rate sitting stubbornly among the highest in the nation, North Carolina is finally seeing numbers that are much more in line with the national average. Check that. On Friday, the state’s jobless rate actually fell below the national average for the first time in nearly eight years, according to the state Commerce Department.
Indeed, in February, the state recorded an unemployment rate of 6.4 percent, down from 6.7 percent in January. The national unemployment average was 6.7 percent in February.
While economists say that the numbers carry a variety of messages, one fact did shine through with some clarity. The number of people employed in our state grew by 7,400 in February and by more than 48,000 over the past year.
While Gov. Pat McCrory was quick to pounce on the newly released numbers as a sign of better times ahead, he wisely offered caution as well.
“I’m pleased to see that more and more people are getting back to work, but the job is far from finished,” McCrory said in a statement.
Indeed, McCrory and Republican leaders often cite reductions in unemployment compensation and corporate income tax as keys to the sharp drop in the unemployment rate, but it is far more complex than that. Liberal critics have pointed to the number of workers who dropped out of the labor force and underemployment — working fewer hours and/or for less money than before losing the previous job — as signs that the declining unemployment rate isn’t as rosy as it might seem.
There is some truth to what both sides say. Some of the drop is due to discouraged workers who simply give up the job search. And some very likely is related to confidence that the change in state leadership bodes well for continued growth — but that would underestimate the broader market forces at work.
And underemployment? Well, that remains a problem going forward that no one seems willing to talk about with much honesty.
But at least two university economists have said over the past month that the economy in North Carolina is getting better, albeit slowly. The first to do so was John Connaughton of the University of North Carolina Charlotte. Friday it was James Kleckley of East Carolina University. Kleckley noted, though, that “When you look at the labor force numbers, it really does give you mixed signals.”
The proof is really in what’s happening in a particular community; some areas are doing better than others. In Alamance County, unemployment declined in recent months, before going up slightly in January to around the national average. We’ll have to see what February’s figures bring.
The challenge, as always, is to keep it going in the right direction.
http://www.thetimesnews.com/opinion/our-opinion/behind-the-state-s-jobless-numbers-1.298164?page=1