Rural areas continue to suffer in the recession, though seasonal industries see job growth; more action at state and federal level is necessary, says analyst
RALEIGH (June 25, 2010) -- Though 86 of North Carolina's 100 counties saw unemployment decrease last month, job growth is too slow to offset the impact of the Great Recession, a labor market analyst said today.
"While jobs are being created, we aren't seeing the number of jobs needed to make up for those lost since the start of the recession," said Alexandra Forter Sirota, a policy analyst with the NC Budget & Tax Center. "A more concerted effort to invest in job creation is necessary to continue to reinforce the modest gains made in this nascent recovery."
North Carolina has lost 251,900 jobs since the recession began.
Those areas that continued to experience an increase in their unemployment rate are communities that struggled prior to the recession with economic challenges in terms of losing key industries and experiencing high poverty rates. These are mostly rural areas, especially those relying heavily on manufacturing jobs.
"Counties with small towns and cities continue to struggle with high unemployment rates and the challenge of creating jobs for those that are looking for work," said Sirota. "The loss of manufacturing jobs has been significant to these communities."
Rocky Mount and Hickory continued to experience the highest unemployment rates at 12.9 and 13.0 percent respectively. Rocky Mount continued to lose jobs -- another 100 on top of the 500 lost in the past year -- while Hickory actually saw jobs grow by 900.
What employment growth exists continues to occur in metropolitan areas. The majority of growth occurred in the major metro areas of Raleigh and Charlotte.
Much of the significant job growth also occurred in seasonal industries, such as leisure and hospitality.
Despite job growth in the Charlotte metropolitan area, the unemployment rate ticked up in Charlotte -- suggesting that more people are coming back into the labor market to seek employment. This trend will likely continue as workers return to the labor market amidst some signs of recovery.
While the direct aid and fiscal stimulus provided in the American Recovery and Reinvestment Act has improved the situation, Sirota said, its effects have likely already begun to wear out - meaning more federal action is necessary.
The Senate's failure yesterday to pass an extension of the unemployment insurance benefits will affect nearly 20,000 North Carolinians a week who will lose benefits according to estimates from the Employment Security Commission. The Senate must take up the jobs bill before the July 4 recess and ensure that unemployment benefits are extended as well as state fiscal relief.
"Without such an extension, consumer spending will likely drop, preventing small businesses from expanding and hampering job growth," said Sirota.
In addition, the state fiscal crisis will likely generate significant job losses in government, she said.