T he dropping North Carolina unemployment rate isn’t necessarily the convincing sign of economic recovery that many state leaders are making it out to be. Incumbents will surely point to this as a sign of their success when their re-election campaigns begin. Voters should be informed enough to have a sense of the true economic climate in North Carolina rather than getting their information from campaign advertisements.
The rate, which came in at 6.4 percent in February, has dropped an encouraging 2.2 percentage points in the past year, causing many across the state to applaud the supposed financial upswing.
The fall, however, is in part a result of discouraged people ending their job hunt after the state withdrew from the federal government’s extended-benefits unemployment insurance program last year.
The unemployment rate is calculated as the percentage of unemployed people in the labor force, which doesn’t include those who have given up on finding a job.
The state’s decision to slash unemployment benefits came in response to a mounting debt to the federal government, which peaked at $2.8 billion in 2012.
North Carolina was the only state to reject the federal benefits in this politically controversial move that affected an estimated 170,000 North Carolinians.
In fact, additional jobs only account for 11 percent of the drop in the unemployment rate, while 89 percent of it is a result of a shrinking workforce.
The state’s economy does seem to be on the upswing, but not quite as convincingly as some statistics would imply.
While areas such as Charlotte and Raleigh are showing signs of economic recovery, others, such as Greensboro and Winston-Salem, have been slower to rebound from the recession.
