NC labor market figures show local governments are in trouble

Over 26,000 local government jobs have been cut in NC since the start of the pandemic

RALEIGH (March 19, 2021) — Labor market figures for January show the COVID-19 recession continues across North Carolina. The pace of the recovery has slowed dramatically in recent months, and many communities that were the slowest to bounce back from the Great Recession are experiencing persistent job losses during this pandemic. Additional federal aid in the American Rescue Plan will certainly help, but it won’t by itself fill the financial hole facing many communities and families.

“Our legislature needs to drive state and federal aid to the front lines of the recovery,” said Patrick McHugh, Research Manager with the North Carolina Budget & Tax Center. “There’s hope for economic improvement over the coming months, but local governments have been severely undermined by this crisis and, without more assistance, many don’t have the tools they need to ensure an inclusive recovery.”

Economic challenges facing North Carolina include: 

  • Local governments need help to sustain and rehire public employees: The COVD-19 pandemic is taking a toll on local budgets, forcing layoffs and undermining the ability of local governments to cope with the crisis. Statewide, over 26,000 local government jobs have been cut since the start of the pandemic, and the cuts have been particularly severe in some communities. Some of the worst losses during the pandemic have occurred in metropolitan areas such as Durham-Chapel Hill (-13.2%), Goldsboro (-12.2%), Burlington (-11.7%), Greensboro-High Point (-8.8%), Asheville (-7%), and Winston-Salem (-7.4%). Without additional aid from the state, these and other local governments will continue to struggle to manage the outbreak and work for recovery.

  • Some large cities starting to bounce back, but recovery is much slower in many regional job centers: The Recovery is further along in some of North Carolina’s largest metropolitan areas such as Charlotte and Raleigh, but it is significantly less robust in many cities that serve as employments hubs for other parts of the state. Some cities in eastern North Carolina have seen extended employment losses compared to before the recession, including Goldsboro (-6.3%), Fayetteville (-5.2%), and Rocky Mount (-4.5%). Job losses have also hit Piedmont Triad job centers Winston-Salem (-5.2%) and Greensboro-High Point (-5.7%), as well as Asheville (-5.7%) in the mountains. All of these metropolitan areas have lost a larger share of their total workforce than the Triangle and Charlotte, threatening a repeat of the Great Recession when many parts of the state were much slower to recover from an economic collapse.

  • COVID-19 has either erased all employment gains or deepened losses since the start of the Great Recession in a majority of counties: Nearly 60 of North Carolina’s 100 counties had fewer people working at the end of 2020 than before the Great Recession. Many parts of the state had never recovered all of the jobs that disappeared in the Great Recession, so the losses during COVID-19 are further compounding a long-term problem.

  • Most counties have seen a huge increase in the number of people looking for work: Even with many North Carolinians having been forced out of the labor market entirely due to illness, caring for a child, or simply not seeing employment opportunities to be found, most counties had far more people looking for work at the end of 2020 than before COVID-19. In more than half of North Carolina’s counties (57 out of 100), the number of people actively looking for work has grown by at least 50 percent since the start of the pandemic.

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

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 patrick.mchugh@ncjustice.org or 919-856-2183; or Mel Umbarger, Budget & Tax Center Senior Communications Specialist, at mel@ncjustice.org.