As we witness a parade of claims that North Carolina’s economy is the envy of the nation, the facts tell a very different story. North Carolina’s economy is not working for everyone.
Our economy is still not working well enough to create the jobs needed.
If we counted all of the people who have left the labor market over the last several years because there are not enough jobs to go around, unemployment in North Carolina is likely still north of 10%. Even those who have been able to find work represent a smaller share of North Carolinians with a job than before the recession started. Unfortunately, economic reality has not yet produced a change of course in Raleigh. Many elected leaders continue to believe that tax cuts will solve our economic ills, in spite of the fact that state’s like California and Massachusetts that focus more on investing than cutting have seen stronger recoveries than North Carolina or our neighbors to the south.
North Carolina has a wage problem.
The past decade has seen North Carolina workers take home less of the value they create. While wage stagnation is a national problem, it is particularly acute in North Carolina, resulting in North Carolina wages losing ground compared to the nation. Moreover, barriers to equal earnings have actually grown during the recovery. The unfortunate reality is that far too many North Carolinians, particularly those earning at or near the minimum wage, are not earning enough to make ends meet. This holds the economy back from reaching its full potential.
Too many North Carolinians face economic hardship every day.
Poverty, which spiked as the Great Recession took hold, has not come back down to pre-recession levels. Because much of the economic growth over the last few years has been concentrated in a few parts of the state, many communities are still struggling to contend with more than 1 in 5 people living in poverty.
We need to do more to help small businesses.
Since the start of the recovery in 2009, larger companies have collectively grown much faster than smaller businesses. At the same time, state leaders passed laws that will make life more difficult for immigrants, who are increasingly important to the economic vitality of main street North Carolina.
We are underfunding our economic future.
State spending is at its lowest level in 40 years, shortchanging investment in education, infrastructure, and innovation. Unless we change course, immediate needs will go unaddressed and North Carolina’s long-term economic foundation will crumble.
Patrick McHugh is a policy analyst for the N.C. Budget & Tax Center.