Unemployment up despite jobs

The state's jobless rate is higher than the overall U.S. rate, new data show.

Staff WriterJanuary 25, 2011 

  • State officials are scheduled to release December jobs data by county next week, providing detail on how the Triangle fared.

    This region has had healthier employment than the rest of the state, even as the local unemployment rate remains high by historical standards.

    The local rate rose to 8.3 percent in November from 8 percent in October, according to figures from the N.C. Employment Security Commission and seasonally adjusted by Wells Fargo Securities in Charlotte.

North Carolina's unemployment rate edged up in December to 9.8 percent as the economic recovery brought anemic job growth across the state.

Although the state added 2,300 jobs in December - the first gain since August - North Carolina's labor market continued to show discouraging trends.

The state added 10,400 jobs over the past 12 months, and its labor force continues to shrink although the population is growing.

"We really went nowhere in all of 2010," said John Quinterno, principal for South by North Strategies, a Chapel Hill research firm specializing in economic and social policy.

"The bottom line is we went 12 months and we really essentially had no meaningful job growth in North Carolina."

The state jobless rate jumped back above the national rate for the first time in three months.

The national rate was 9.4 percent in December, down from 9.8 percent the month before.

Economists expect the unemployment rate to rise as the recovery gains traction - the result of people who had given up looking for work returning to the labor market.

But the pace of job growth continues to be too slow to make a dent for the roughly 440,000 unemployed workers in North Carolina.

While the state's unemployment rate has declined from 10.9 percent to 9.8 percent over the past year, most of that drop is attributed to people leaving the work force.

Some of the hardest hit areas of the state's economy also continue to bleed jobs. The construction industry posted the largest decrease of any sector, with 3,900 jobs lost in December and 11,500 eliminated over the past year.

Raymond Pate, a civil engineer and land surveyor, has been out of work since he closed his business in Nags Head in 2009. He moved to Raleigh about a year ago, thinking that the Triangle would recover quicker than the coast.

Pate, 56, estimates that he has applied for 100 to 150 jobs. He's now resigned to the fact that he will likely not find a job in his field.

"It's very disheartening," he said. "I'm looking at trying to figure out something else to do. I'll probably see if I can work at a Lowes or a Harris Teeter or something; I don't know."

Pate's unemployment insurance is set to run out in May.

"I'd take a $10 an hour job if necessary just to try and make ends meet," he said. "I'm going to do whatever I can to keep the wolves away from the door, but right now my options are pretty limited."

The dismal labor market data is in stark contrast to the growth being recorded in the nation's gross domestic product and manufacturing productivity, said Mark Vitner, a senior economist with Wells Fargo Securities in Charlotte. Some industries are adding jobs. In the Triangle, technology firms Cree and Red Hat have announced plans to hire hundreds of workers.

But Vitner said many of the industries that are expanding fastest are capital-intensive operations that have been able to ramp up production without adding workers.

"The labor intensive parts of our economy are continuing to focus on cutting costs," he said, noting the recent announcements that J.C. Penney plans to close a store in High Point and that BJ's Wholesale Club is closing one in Charlotte. Last week, American Express announced plans to close its Greensboro call center with 1,900 employees.

"The economy's in a tough spot, where it's improving everywhere but the labor market. And that can't continue," Vitner said. "In order for us to have a sustainable recovery and one that will be long-lasting, we need to see stronger job growth."

david.bracken@newsobserver.com or 919-829-4548

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