North Carolina’s jobless rate dipped below 5 percent for the first time in nearly nine years as the state added jobs in nearly every labor category in June.
The state’s jobless rate in June fell to 4.9 percent, down from 5.1 percent in May and from 5.8 percent in June 2015. The last time North Carolina’s jobless rate was 4.9 percent was in September 2007, on the eve of the great recession.
The seasonally adjusted jobless data was issued Friday by the N.C. Department of Commerce. The national jobless rate was also 4.9 percent in June, marking the first time North Carolina was not above the national average in more than a year.
North Carolina added 19,400 jobs in June and the state has grown by 89,100 non-farm jobs in the past 12 months. Only financial activities and other services posted declines in June.
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Over the past year, jobs in North Carolina expanded at 2.1 percent, exceeding the national average rate of 1.7 percent. Statistical sampling can be imprecise but economists generally accept North Carolina’s jobless picture as accurate.
“I do think the improvement in the unemployment rate in the last year is genuine,” said Mark Vitner, senior economist for Wells Fargo Securities. “There’s no doubt North Carolina has been adding jobs at a faster rate than the country.”
The durability of June’s improvement, however, was open to question. The state’s labor force shrunk by 14,674 people last month, and a shrinking labor force tends to result in a lower jobless rate.
The labor force comprises those working and those looking for work. The labor force can shrink when people become discouraged and stop looking for work, or when they move out of the area, or when people retire.
Additionally, 3,774 fewer people were employed in the state in June than in May.
Patrick McHugh, an economic analyst with the N.C. Justice Center’s Budget & Tax Center, noted that other economic data suggest North Carolina is worse off today than it was nine years ago. One indication: North Carolina workers are getting paid below the national average, and the gap has widened during the long-running economic recovery.
Average weekly earnings were $880.98 nationwide in June, compared to $803.85 in North Carolina. The highest average weekly wage in the state was in the Durham and Chapel Hill – $958.07. The lowest was in Jacksonville – $537.84. Those disparities indicate that North Carolina’s growth is restricted to urban areas, while residents in much of the state are falling behind economically, McHugh said.
Also, more North Carolinians were out of work in June than before the recession: Nearly 240,000 North Carolinians were looking for work last month, McHugh said, roughly 11,000 more than before the recession.
“The fact is, we’re not doing great,” McHugh said. “We’re doing OK.”
The Triangle jobless rate for June will be issued Aug. 3.