Lack of jobs and barriers to unemployment forcing people out of the labor market

Read the Fact Sheet: Leisure and Hospitality was bolstered by Unemployment Insurance at critical moments in pandemic.

RALEIGH (May 21, 2021) — Jobs data released today show weak job growth is forcing people out of the labor market. For the first time since April 2020, North Carolina lost jobs last month, and the average rate of recovery over the past six months has slowed to less than 10,000 jobs per month.

“People want to get back to work, but the jobs just aren’t there,” said Patrick McHugh, Research Manager with the North Carolina Budget & Tax Center. “Nearly as many people have been forced out of the labor market as found jobs this year, and there are still around 67,000 more North Carolinians looking for work than before COVID-19.”

Click for charts with new labor market data

Economic challenges facing North Carolina include: 

  • Not enough job growth to get people back to work: After losing nearly 6,000 jobs in April, North Carolina has only added 24,000 jobs since the start of the year. With North Carolina still nearly 167,000 jobs short of pre-recession levels, this lack of jobs growth is forcing people out of the labor market entirely. Since the start of 2021, nearly as many people have left the labor market entirely as have found jobs, a clear sign that ongoing lack of job growth is a barrier to recovery.
  • More North Carolinians still looking for work: While the headline unemployment rate has declined in recent months, the recovery still has not created enough jobs for everyone that wants to work. Roughly 67,000 more North Carolinians reported looking for work in April than before the COVID0-19 outbreak and, as noted above, nearly as many people have left the labor market entirely than found work in recent months. The combination of more people looking for work and people leaving the labor market entirely shows the severity of the economic challenges facing people who want to work.

  • Headline unemployment rate does not reflect racial disparities in barriers to work: As is sadly often the case, barriers to employment are more pronounced for people of color. While the monthly labor market figures released today are not broken down by race, data through the end of 2020 showed that workers of color experienced higher levels of unemployment throughout the COVID-19 pandemic. In the first quarter of the pandemic, job losses pushed the unemployment rate for Black and Hispanic workers above 14 percent, while white unemployment remained below 10 percent. By the end of 2020, the unemployment rate for Black workers (8.8 percent) and Hispanic worker (6.6 percent) had fallen but were still  above the rate for white North Carolinians (5.2 percent).

  • Low-wage workers are still in a deep recession, while high-wage jobs have recovered. Data through mid-March show North Carolina has more high-paying jobs (over $60,000) than before the start of COVID-19, while more than 10 percent of the jobs paying less than $27,000 are still missing.
  • Job losses are heavily concentrated in some industries, particularly among the worst-paid workers: The COVID-19 recession has devastated workers in some industries, while others have almost fully recovered. The largest persistent job losses since February of last year have occurred in industries like Accommodation and Food Service (-64,600), Government (-41,600), Health Care and Social Assistance (-19,000), and Arts, Entertainment and Recreation (-16,300).

For charts showing the most recent labor data and COVID-19 job data, visit the Budget & Tax Center’s Labor Market page at

For more context on the economic choices facing North Carolina, check out the Budget & Tax Center’s Prosperity Watch report.

The nonpartisan Budget & Tax Center is a project of the NC Justice Center, which works to eliminate poverty in North Carolina by ensuring every household in the state has access to the resources, services and fair treatment it needs to achieve economic security. 

FOR MORE INFORMATION, CONTACT Patrick McHugh, Budget & Tax Center Research Manager, at or 919-856-2183; or Mel Umbarger, Budget & Tax Center Senior Communications Specialist, at