Business

Disconnect exists between NC business climate, unemployment rate

Posted July 13, 2012

— Once again, North Carolina is ranked high on the list of places to do business in the U.S. But the state also has the nation's fourth-highest unemployment rate, at 9.4 percent.

Experts say the disconnect between business climate and employment comes down to regional differences across the state's 100 counties.

The Triangle and other metropolitan areas are faring OK, with the highest unemployment rates concentrated in rural areas where companies aren't looking to do business.

"There's a bunch of reasons why that disconnect is going on," said Ronnie Chatterji, an associate professor at Duke University's Fuqua School of Business.

One is North Carolina's heavy reliance on manufacturing industries, which is higher than most states, Chatterji said.

"When manufacturing takes a hit, North Carolina takes an especially hard hit," he said.

Another reason is the relative dearth of college graduates in rural areas of the state, he said.

"The unemployment rate is very low (for people) with college degrees," he said. "Two-thirds of North Carolinians don't have a college degree, and unemployment rates are very high for that category."

Still, business news cable television channel CNBC recently listed North Carolina No. 4 nationwide for top states for business.

Reliance on manufacturing, lack of college education hurts NC in downturn Manufacturing base, lack of college education hurts NC in downturn

CNBC used a weighted formula of 10 categories to come up with its rankings, and North Carolina ranked in the top 10 in three of them – workforce, technology and business friendliness.

"It's still a state that is open for businesses (and) very conducive to businesses," said Lew Ebert, president of the North Carolina Chamber.

The state's economy was its worst category, at 31st nationally, according to the rankings.

"We're most concerned about the cost of doing business. We actually went from ninth a year ago to 21st," Ebert said.

Chatterji said North Carolina's frequent appearance on Top 10 lists also could be playing a role in the state's sluggish economy. Many people are moving to the state without a job because it sounds like at attractive place to live, he said.

That's not a reason for long-term concern, however. He said that, when the economy turns around, those people will find jobs and better position North Carolina during the rebound.

42 Comments

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  • djofraleigh Jul 13, 7:47 p.m.

    The appeal of NC to employers usually leaves out the Workman's Comp rules in NC, for one.

  • geosol Jul 13, 7:34 p.m.

    "With the Democrats in charge the economy is worse in the areas with the highest rates of poor minorities." Shocker, isn't it? And now that the REPUBLICANS are in charge of NC government with a veto-proof majority that has changed completely, right? Thanks for all your help, REPUBLICANS!!

  • geosol Jul 13, 7:32 p.m.

    Remember that "jobs, Jobs, JOBS!!!!" lie that the REPUBLICANS used to get elected? Yeah, well, apparently neither do the REPUBLICANS.

  • dirtydozen431 Jul 13, 7:23 p.m.

    With the Democrats in charge the economy is worse in the areas with the highest rates of poor minorities.

  • storchheim Jul 13, 7:19 p.m.

    ryoung, glad you're living such a charmed life. I hope you don't lose your job or you may find out firsthand how hard it is for an over 55 yo programmer to find a job. Sure it's easier while you're still working, and good for you for keeping up your skills, but hang onto that job. Middle-aged is 40 and up. I had no trouble in my 40s or early 50s, but now that I'm 57, it's over. Even if I went back to school, I wouldn't have the 5-7 years experience that the H1-B's say they have.

  • sunshine1040 Jul 13, 7:13 p.m.

    Lets see John makes $20,000 a year has 3 children and pays how much in taxes ZERO Jack makes $200,000.oo and has no dependents but invest in the tock market donates to his church and pays $20,000 in taxes. But Jack should still pay more in taxe because he invested in condoms maybe. or because in invested his money wisely

  • TheBone Jul 13, 7:05 p.m.

    Drop the bomb. Make sure it hits all the CEO's, CFO's & CIO's. The "people" that promote the team atmosphere, as long as it's the management's "I" team. Make my tax dollars work for something real.

  • geosol Jul 13, 7:02 p.m.

    How about giving tax breaks to teachers, firemen, and police instead of billionaires and oil companies?

  • Boot-the-DC-Tyrant Jul 13, 7:02 p.m.

    I know what will build business and make them hire!!! Tax them to death until they just fold up and go under! Yeah, that's the key!!

  • DontVote4LiarsCheatsOrThieves Jul 13, 6:51 p.m.

    SlickGirl -

    YOU are absolutely right!!!

    Those saying the unemployed are uneducated, and/or unskilled, and/or unmotivated, etc. etc. Have no idea.

    They may presently be sitting in a steady well-paying job, but thanks to the GLOBAL job market, that could end at any time.

    I pray it doesn't, for then they'll learn firsthand how wrong they were, and I wouldn't wish that on anyone.

    Thank God I was in a position and of an age to retire. So many don't have that luxury.

    And by the way, Walmart starts at minimum wage, and you're lucky to get more than 10-12 hours a week in any grocery store or big box store unless you've been with them for years and years already.

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