N.C. State University economist Michael Walden’s biannual economic diagnosis for the state warns that much of North Carolina’s post-recession growth is bypassing the so-called “routine” middle-income vocations and exacerbating the state’s growing regional gap and income inequality.
Walden’s report, issued Monday, shows that the most dramatic job growth in the state has taken place at the extremes of the pay scale. The greatest gains have benefited the highest-paying bracket: professional and business services category, which gained about 138,000 jobs since February 2010. Next in line are jobs in the lowest-paying category: retail and transportation jobs, gaining about 114,000 jobs, and restaurant and hospitality, gaining about 82,000 jobs.
Closely tracking that trend are the regional winners and losers behind those job numbers. Charlotte and Raleigh “are in a class of their own,” Walden writes, with 20 percent employment growth since 2010. Asheville, Durham and Wilmington have grown between 10 and 15 percent in employment. But economically distressed areas like Burlington, Goldsboro, Greensboro, Hickory, New Bern, Rocky Mount and rural regions are still below their pre-recession employment levels.
“The routine jobs are much more being taken over by technology,” Walden said. “The changes in economic structure are really behind the regional disparities that we see.”
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Walden’s biannual report is based on available federal data but compiled to provide a more detailed picture of North Carolina than is available from existing sources.
Walden said the current economic expansion is the third-longest since World War II, but also agonizingly slow compared to past recoveries.
“What stood out to me is the slow rate of growth in this expansion,” he said.
The state’s economy has become a study in contrasts. Even as the state’s jobless rate is projected to drop to 4.4 percent in 2017, with urban economic engines revving up high-paying white-collar jobs, the number of people left behind is not shrinking. About 175,000 people in North Carolina had given up looking for work or were under-employed in 2007, and that total doubled by 2011 in the wake of the recession, but earlier this year those discouraged and underemployed workers still totaled more than 250,000 in the state.
Those numbers are telling because they are typically not included in monthly jobless rate updates.
Walden projects that North Carolina will gain 86,000 jobs in 2016 and 90,000 in 2017. He is not expecting a recession this year or next, but he noted there is less certainty about cyclical downturns by 2018.
Wrote Walden: “Retaining displaced workers and training new workers for the jobs of the future will require a significant commitment from the state to avoid massive ‘technological unemployment.’”