North Carolina is part of the Richmond District of the Federal Reserve Bank. Each month, Richmond Fed economists prepare an Economic Snapshot of the district and provide detailed information on each of its states, as well as summaries of MSA performance.
Summary of the District Overall
- Performance is “sluggish”
- Net month-to-month job losses of 7,500 in August, fueled mostly by government employment reductions; total jobs still 50,000 higher compared to last year
- District unemployment rate is lower than National Average, due in large part to strong performance in Washington, DC MSA (i.e., federal government influence)
- Business conditions “did not change notably”; new manufacturing orders “fell sharply”
- New housing permits rose, but new housing construction starts fell
- Revised personal income estimates (via BEA) show a more significant drop in personal income during the official recession period than thought before. Pre-recession incomes were at a higher per capital level, and the level of decline during the recession was greater as well (revised from about 2.5% to 4%)
Observations on North Carolina
- Conditions “remained weak in recent months, with mixed conditions in labor and housing markets”
- State did gain 16,500 jobs in August, with the net made entirely possible by the rehiring of public school teachers (+16,800), Year-to-year total employment is up more than 21,000, while government employment is down 14,700.
- State unemployment rate is above 10% and is higher than the national and Richmond District rates
- Housing construction activity is up from recent droughts, still below last year’s (depressed) levels
- Revised personal income estimates from BEA show a similar trend to the Richmond District as a hole. Unfortunately, while District PCI has already rebounded to eclipse pre-Recession levels, North Carolina PCI is still approximately 2% below full recovery (not including inflation). Overall drop as a result of the recession to per capita income (from highest point to lowest point) was revised from 4.1% to 6.5% (and this does not take into account the impact of inflation.