BTC BRIEF: Lack of Jobs Drives Exodus from Workforce in North Carolina

By Alexandra Forter Sirota
Director of the Budget & Tax Center
April 2014

A quarter-million North Carolinians in their prime working ages are neither employed nor seeking work because their chances of finding a job are bleak. These “missing workers” are not reflected in the state’s official unemployment rate and their ranks have grown 65 percent over the past year, another indication that North Carolina is failing to generate enough jobs despite an official drop in unemployment.

The state’s unemployment rate would be nearly double what it is now if these missing workers were counted. A new measure of the labor market’s missing workers, developed by the nonprofit, non-partisan Economic Policy Institute and adapted here for North Carolina, estimates the number of men and women who would have been working or seeking work if the Great Recession had never happened and job opportunities had remained strong over the last five years. These missing workers are not reflected in the official U.S. or North Carolina unemployment rate.

The growth in the number of missing workers is stifling the state’s economic potential, as well as adding to the everyday struggles of tens of thousands of families who are finding it increasingly difficult to make ends meet nearly five years after the Great Recession officially ended. It is critical that North Carolina policymakers invest in education, job training, infrastructure development and subsidized employment that will lead to the creation of more jobs. At the same time, a focus on policies that strengthen the connection to the workforce for the state’s men and women who are seeking work in a weak labor market is important.

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