Labor & Economic Analysis Division; January 2013 Report
In December, the North Carolina economy continued to slowly
improve as it headed into 2013. The unemployment rate increased
0.1 of a percentage point in December to 9.2 percent while the
national rate remained at 7.8 percent. Total nonfarm employment
gained 7,900 jobs in December, mainly in the Education and Health
Services industry, which added 5,900 jobs over the month, and 6.3
percent since the start of the recession. The average
manufacturing workweek increased to 41.2 hours from 40.7 hours in
November exceeding more than 41 hours for the first time since April
2012.
In December, online advertised vacancies in North Carolina rose by
1,400 (seasonally adjusted) and 24,700 (or 21%) from December
2011. December’s monthly level of labor demand in North Carolina
exceeded the prerecession high in 2007. The state’s November 2012
labor supply/demand rate stood at 3.08 (indicating there are litle
more than three unemployed persons for every job advertised
online). This is one point higher than the prerecession level but
comparable to neighboring states. Demand for Registered Nurses,
First Line Supervisors (for both retail and food preparation) and Retail
Sales occupations together accounted for nearly one-quarter of the
total increase. Vacancies for Registered Nurses rose 48 percent,
making them the largest occupation in demand.
North Carolina personal income grew by 0.4 percent in the third quarter 2012; slightly slower than the national rate of 0.5
percent. The largest contributions to earnings growth came from professional services, management and healthcare. North
Carolina manufacturing added $302 million in earnings in the third quarter 2012 and was 27 percent of total state earnings.
Echoing a national trend, financial services was a large drag on growth, declining by $369 million for the quarter. Similar rates of
decline were felt in financial states like New York and New Jersey.
There was a slight dip in North Carolina housing activity In November, but it continued to greatly outpace 2011. The number of
North Carolina residential building permits was nearly 43 percent higher than November 2011. November existing home sales in
North Carolina jumped by 30 percent when compared to November 2011. Existing home sales price levels plateaued in the fall
but are 5.4 percent higher over the year. The average North Carolina existing home sale price was $202,933 in November.
In November, North Carolina ranked 15th in the nation in the value of its exports and 5th among the 12 states in the Southeast
region. North Carolina’s exports in November totaled $2.4 billion, up 6 percent over the same period last year. The increase was
due to the rising outbound shipments of transportation equipment, machinery, and agricultural products. Machinery was the
state’s largest export, followed closely by chemical products — both accounted for 30 percent of the state’s overall exports in
November. However, chemical exports fell 11 percent from the same period last year, mainly due to the decrease in demand of
basic chemicals in Japan.
Canada remains the state’s largest export destination with November exports totaling $568.8 million, distantly followed by
Mexico and China. Compared to the same period last year, exports to Canada and Mexico rose 2 percent and 28 percent,
respectively, while exports to China declined 22 percent as China’s economic growth continued to slow.
Statewide, the hotel/motel occupancy rate increased in November 2012 to 53.5, which was 1.6 percent higher than November
2011. These rates are the highest levels of November occupancy since 2007. November room rates rose nearly three percent
from 2011, and 4.6 percent year-to-date through November. The Southeast Region posted the highest demand growth in the
state during November, gaining 8.0 percent from 2011. Room revenues in the Southeast Region grew 9.0 percent in November.
The Charlote, Triad, and Western Regions also showed strong growth in lodging revenues during the month as compared to
2011.
KEY INDICATORS AT A GLANCE
NC Unemployment Rate
increased to 9.2% from 9.1%
NC Total Nonfarm Employment
increased 7,900 jobs
NC Manufacturing Weekly Hours
increased 0.5 hours
NC Help Wanted Online
increased by 1,400 online job openings
NCSU Index of Leading Indicators
increased 0.3%
US Consumer Confidence Index
fell to 65.1 from 71.5
NORTH CAROLINA ECONOMIC OVERVIEW: January 2013
Department of Commerce
NORTH CAROLINA
Labor & Economic Analysis Division; January 2013 Report
The NCSU Index of North Carolina Leading Economic Indicators (the “Index”), a forecast of the economy’s direction four to six
months ahead, continued its late-year improvement by rising 0.3 percent in November. The Index is now at its highest level in
almost five years. Among the individual components, improvements were registered for initial jobless claims, manufacturing
hours, and manufacturing earnings, while the national index and building permits retreated. Based on the Index’s trend in the
last two months (October and November), an acceleration of North Carolina’s economic growth rate may be developing for
early 2013.
The NCSU Index of North Carolina Leading Economic Indicators was developed by Dr. Michael Walden at NC State University. Dr.
Walden has a PhD in economics and more than 30 years of experience studying North Carolina’s economy. Special thanks to Dr.
Walden for allowing the reproduction of the Index (December 2012, volume 3, number 12) in this publication.
The National Economy
The fiscal clif legislation that passed on New Year’s Day may reduce the possibility of a recession this year, but does not
eliminate continuing political uncertainty. According to the Congressional Budget Ofice’s fiscal clif legislation report, relative
to what would have occurred under the laws previously in efect, the legislation will increase budget deficits in coming years.
However, relative to what would have occurred if most tax and spending policies that were in efect in 2012 were continued, this
legislation will reduce budget deficits. Regardless, the looming debt ceiling and budget-cuting sequestrations may add political
uncertainty heading into spring.
This uncertainty weighed on business optimism and consumer confidence in December before the deal was passed. Small
business optimism crept up 0.5 percent over November’s historically low report. The 88.0 point reading was still the second
lowest since March 2010 and was partially caused by owners who still expect business conditions to worsen in the next six
months. An important indicator of future capital investment and hiring, CEO confidence increased in the fourth quarter to 46
from 42 in the third quarter. Despite the uncertainty, 23 percent of business leaders expected economic conditions to improve
in the next six months, up from 14 percent in the third quarter. E-commerce spending totaled $42.3 billion online during the
entire November-December holiday shopping season, marking a 14-percent increase from 2011. While the holiday season
started of with strong growth, a decline in consumer confidence gave way to softer than expected buying during the critical
shopping weeks in early to mid-December, from which growth rates never fully recovered. December retail sales totaled $416
billion, 4.7 percent above December 2011. As spending increased, it appears consumer borrowing did also. In November,
consumer credit increased at a seasonally adjusted annual rate of 7.0 percent. Revolving credit increased at an annual rate of
just 1.0 percent, while nonrevolving credit increased at an annual rate of 9.5 percent.
Economic Indicators
If you would like to be added to the distribution list, please contact Tim Aylor at (timothy.aylor@nccommerce.com).
Previous Monthly Overviews are available on Commerce’s website by clicking here.
8.0%
8.5%
9.0%
9.5%
10.0%
10.5%
11.0%
Percent of Persons Unemployed
NC Unemployment Rate
Source: Local Area Unemploymenet Statistics, Seasonally Adjusted
3,880
3,900
3,920
3,940
3,960
3,980
4,000
4,020
Jobs
NC Total Employment
Source: Current Employment Statistics
39.0
39.5
40.0
40.5
41.0
41.5
Hours
NC Manufacturing Weekly Hours
Source: Current Employment Statistics
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
Number of Home Sales
NC Existing Home Sales
Source: NC Assocation of Realtors
100,000
105,000
110,000
115,000
120,000
125,000
130,000
135,000
140,000
145,000
Advertised Vacancies
NC HWOL Advertised Vacancies
Source: The Conference Board, Help Wanted OnLine, Seasonally Adjusted
344
346
348
350
352
354
356
358
360
Billions of Dollars
NC Personal Income
Source: US Bureau of Economic Analysis