NC unemployment climbs to 10.7 percent in February

by the Associated Press
Published/Last Modified on Saturday, March 28, 2009 8:12 AM EDT

RALEIGH (AP) — For the first time in nearly three decades, well over one out of every ten workers in North Carolina is out of a job.
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The nation’s economic crisis, which in the past year has led to hundreds of thousands of job cuts and layoffs in North Carolina, boosted the state’s unemployment rate to a record 10.7 percent in February — the highest figure since the state started keeping records in the mid-1970s.

“It’s a bit of a catastrophe for the state,” said John Coleman, an economist at Duke University’s Fuqua School of Business. “The pace of the deterioration of the employment situation is dramatic.”

In no other state have the ranks of the jobless grown so fast. The state’s jobless rate climbed from 9.7 percent in January, and is a dramatic increase from 5.2 percent in February 2008. More than 50,000 people lost their job last month, joining the more than 200,000 who had already lost a steady paycheck in the past year.

The epicenter of the recession’s toll on the state’s workforce continues to be in manufacturing, a sector that shed 14,900 workers in February and 67,500 since December 2007. Makers of furniture and related products have cut payrolls hard as more of the work is outsourced overseas, shrinking their work force by 9,300 in the past year.

While manufacturing has suffered a steady decline for decades, it still makes up about a fifth of North Carolina’s economy. Coleman said that made the state more vulnerable than others to the recession, which has hit housing, home furnishings and transportation especially hard.

“That’s probably the main reason why North Carolina was vulnerable to this downturn,” Coleman said.

There are jobs to be had. The state Employment Security Commission has listings for almost 18,000 open positions on its Web site, and there are countless others that aren’t publicly announced. They range from positions in health care to food processing, information technology to weather-stripping homes for energy efficiency.

At Raleigh-based Red Hat Inc., for example, the open-source software company reported solid profits this past week and has 30 positions for hire, including paid summer interns.

“We are hiring at all levels and across all departments, from sales to support to back office things like finance,” senior vice president DeLisa Alexander said. “The industry is consolidating. A lot of companies are really struggling to make their (profit) numbers. That makes it a lot easier for companies like Red Hat that are growing to add talent.”

At SAS Institute in Cary, the open jobs are for solutions architects and analytic engineers, highly technical positions for which an advanced degree is preferred. While such jobs in information technology exist, the North Carolina Technology Association said there were four times as many opening in the field a year ago.

In the booming health care field, many of the open jobs — such as heavily sought after nurse practitioners — require years of education and training. When the North Carolina Hospitals Association last surveyed its members in September, more than half of the 7,000 vacant jobs were in nursing, said spokeswoman Stephanie Strickland.

Even those companies talking about hiring are hesitant to do so.

A year after she was laid off from her job as a business analyst at Fidelity Investments in Research Triangle Park, Christina Holley said Friday she’s had some contact with prospective employers. But each company, Holley said, told her they were wrestling over whether to spend the money on salary or save it.

“They want to hire you, but they say, ’We just can’t spend the money on new talent,’ “ Holley said. “I’m sure they want to be conservative with their money, but if you want additional business you have to hire additional people to do that.”

The last time North Carolina’s jobless rate was this high was February 1983, when it reached 10.2 percent. The state’s records go back only to 1976, when the federal Bureau of Labor Statistics standardized its current analysis method. Jobless rates were not recalculated to estimate unemployment during the Great Depression.

North Carolina’s jobs picture is now the fourth-worst in the country, a measure of misery topped only by Michigan with its 12 percent unemployment rate, South Carolina’s 11 percent rate and Oregon at 10.8 percent. Seven states have unemployment rates that topped 10 percent last month, the U.S. Labor Department said. The national unemployment rate was 8.1 percent in February.

The jobs report did contain some hopeful signs. Fewer newly jobless workers filed initial claims for unemployment insurance,which could represent some people going back to work. It also could mean more workers are running out of benefits, which means they are no longer counted, employment commission spokesman Larry Parker said.

Also, 60 percent of the new claims in February were “attached” to a payroll, meaning an employer that expects to recall workers to their jobs handles the application for jobless benefits.

“The company doesn’t want to have to let these people go,” Parker said.

 

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