BTC REPORTS: The Jobs and Economic Impact of the FY2011-13 North Carolina State Budget - A Whole-Budget Analysis Shows Widespread Private-Sector Job Losses Across all North Carolina Regions

By Allan Freyer
Policy Analyst, BTC
August 2011

Executive Summary:

  • Every region will have more money taken out of the local economy through spending cuts than is put back in through tax cuts. Rural regions are especially hard-hit, averaging a loss of $1.80 in spending cuts for every $1.00 put back into those regions through tax cuts, while urban regions only lose $1.50 in spending cuts for every $1.00 gained through tax cuts.
  • Once budget cuts take full effect in FY2012-13, the whole-budget impact will cost each region between 1,624 and 9,242 lost jobs and between $65 million and $486 million in lost labor income.
  • A high percentage of these job losses will occur in the private sector, ranging from 42% in the Eastern region to 60% in the Piedmont Triad.
  • The impacts are especially negative for rural areas, which lose an average of 4 jobs due to spending cuts for every job gained back through tax cuts. Urban regions only lose an average of 2.7 jobs from spending cuts for every job gained from tax cuts.
  • Within these overall impacts, the unnecessary loss of federal matching dollars for SCHIP and Medicaid will also cause significant job losses, ranging from a low of 529 jobs lost in the Northeastern region to a high of 3,900 jobs lost in the Research Triangle.


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