Wells Fargo: ‘North Carolina’s economy
has clearly shifted into high gear’
Wells Fargo & Co. (NYSE:WFC) says North Carolina’s job market is operating at full-tilt. The San Francisco-based lender, which has its East Coast hub in Charlotte, recently released an economic update on the state. The gist: “North Carolina’s economy has clearly shifted into high gear,” senior economist Mark Vitner and his team wrote in the report.
Here are 5 takeaways to remember:
1. The unemployment rate (5.3%) in North Carolina is below the national average.“The quality of jobs being created has also improved, with growth led by gains in the professional & technical services industry,” Wells says. “Hiring in the construction and manufacturing sectors has also sprung back to life, which is particularly good news for manufacturing-intensive areas, such as Greensboro, Winston-Salem, Hickory, Charlotte, Raleigh and many rural parts of the state.
2. People here are making things. Wells says goods-producing jobs have increased 4.7% over the past 12 months, a net gain of 28,800 jobs. Construction jobs have surged 9% over the past year, producing a net gain of 15,300 jobs, while employment in manufacturing is up 3.1%, producing a net gain of 13,600 jobs. Manufacturers employ 458,300 workers in North Carolina, which equates to 10.9 percent of the state’s employment base.
3. The more we make, the better for everyone.“Construction and manufacturing have very high multiplier effects, helping drive gains in wholesale trade, transportation and other parts of the service sector. These knock on effects are apparent in the latest data.” How much? Wholesale trade (+4.2%); transportation, warehousing & utilities (+4%).
4. It’s about time. For years and years, North Carolina has been hard hit by overseas competition siphoning away textiles, furniture and other manufacturing jobs, Wells says. But now? “Conditions have improved considerably over the past couple of years, however, with notable expansions by firms such as Gildan, PEDS Legwear and Ashley Furniture,” the economists write. “The loss of higher-paying manufacturing, construction and distribution jobs was particularly hard for smaller metro areas and rural parts of the state, where the employment base was more narrowly focused around one or two key industries.”
5. More improvement will be difficult.With unemployment rates down, manufacturers hiring and the economy expanding, Wells says more people will look for work. While jobs are available, the numbers will improve slowly from this point, even if growth continues. “Although the stronger labor force growth is a positive development, it will make it more difficult for the unemployment rate to decline significantly from current levels.”
Adam O’Daniel is Finance Editor of the Charlotte Business Journal and his preceding story first appeared in that publication on Monday, March 20, 2015. Follow Mr. O’Daniel on Twitter @CBJODaniel.
Mark Vitner is a managing director and senior economist at Wells Fargo, responsible for tracking U.S. and regional economic trends. Based in Charlotte, he also writes for the company’s Monthly Economic Outlook report, the Weekly Economic & Financial Commentary, and provides regular updates on the housing markets, commercial real estate, regional economies, and inflation. His commentary has been featured in the New York Times, Wall Street Journal, Bloomberg, and many other publications.