RALEIGH (January 27, 2015) – North Carolina’s labor market is still not out of the woods a full seven years after the start of the Great Recession, according to newly released labor market data. Although the headline unemployment rate continues to come down, there were more people looking for work and a smaller share of North Carolinians with a job in December than before the financial crisis of 2008.
“As long as there are still more people looking for work today than before the Great Recession, you can’t call this a full recovery,” said Patrick McHugh, economic analyst with the Budget & Tax Center, a project of the NC Justice Center. “North Carolina still faces a deficit of almost 415,000 jobs before we get back to the level of employment that was typical before the recession.”
A look at the latest data provides the following key insights into labor market conditions:
- A smaller share of North Carolinians is working today than before the Great Recession. With the decline in labor force participation, the percentage of North Carolinians that have a job also fell during 2014, and remains well below pre-recession levels. 56.5 percent of North Carolinians had a job in December 2014, down from 56.8 percent in December 2013, and well off the pre-recession levels which were north of 60 percent.
- Labor force participation in North Carolina is falling behind the nation. The decline in worker participation in the labor market has been more dramatic in North Carolina than for the nation, both over the last year and compared to before the recession. While the state lost 1.3 percentage points in labor participation during 2013, the nation only slid by 0.1 percentage points. The cumulative effect of the last five years pulled national labor participation down by 3.3 points, but North Carolina fared significantly worse dropping 5.5 percentage points.
- Improvements in NC during 2014 reflect a strengthening national economy. The headline reduction in the unemployment rate in North Carolina largely reflects a national trend. During 2014, North Carolina’s unemployment rate came down by 1.4 percentage points, compared to 1.1 percentage points for the nation.
- The number of unemployed people fell over the year, but is still higher than before the recession. There were approximately 255,000 officially unemployed North Carolinians in December 2014. That is down from the same month a year earlier, but is still higher than before the onset of the Great Recession. In spite of the best year for employment since the financial crisis, there were still almost 28,000 more North Carolinians looking for work than in 2007 before the financial crisis.
- The unemployment rate is falling, but it’s still higher than pre-recession levels. Like the total number of people out of work, the unemployment rate came down substantially in 2014, but still remains higher than before the recession. The official unemployment rate came down by 1.4 percentage points during 2014, but is still above what we were accustomed to seeing in the lead-up to the recession.
“With so many people still looking for work, there is a lot of competition for the few job openings that are out there and relatively little pressure on employers to raise wages,” McHugh said. “The result is hardly a comeback – it’s more like a rally that continues to fall short.”
FOR MORE INFORMATION CONTACT: Patrick McHugh, firstname.lastname@example.org, 919.856.2183; Jeff Shaw, email@example.com, 503.551.3615 (cell).