Local NC labor markets make progress as the Fed keeps up effort to bring inflation to heel
On the same day that Federal Reserve policymakers announced another hike to the lending rate, new local labor market data show that the recovery from COVID-19 continues to spread across North Carolina. The pace of recovery is far from uniform and worries about the potential for a recession cannot be ignored, but the strong job growth we’ve seen over the past few years continues.
September marked something of a milestone for the COVID recovery. Exactly one-half of North Carolina’s counties now have more residents working than before the pandemic arrived. Compared to recent recoveries from economic downturns like the Great Recession, this is a much faster pace in regaining employment losses. Another sign that the recovery is really reaching most communities in a way that was not true in the years immediately after the Great Recession is that almost every county in North Carolina (94 of 100) has more residents working than this time last year. That’s good news to be sure, as well as a testament to the power of federal aid that far exceeded the response to the financial collapse of 2009.
While the strength of the recovery teaches a valuable lesson about what a robust government response can do to mute the effects of a crisis, we can’t treat continued recovery as a foregone conclusion. With little prospect of more federal assistance anytime soon, we’re now left with the challenge of avoiding a replay of what happened after the Great Recession, where the major metropolitan areas of the state surged ahead while many communities never recovered what was lost. Five large counties (Wake, Mecklenburg, Durham, Johnston, and New Hanover) account for over three-quarters of the net increase in residents working since the start of the pandemic. Gains over the past year have been more evenly distributed, with less than one-half of the net increase concentrated in the five fastest growing counties. Still, the lopsided nature of the recovery clearly shows that we have not done enough to drive investments to every corner of the state.
We’ll all be closely watching to see when and how Federal Reserve interest rate increases slow down the pace of job growth and whether it’s possible to get inflation under control without causing a recession. All that said, the jobs picture in NC continues to be strong.
