How did we do?
Date posted: February 23, 2011
As the economy slowly begins to turn for the better, maybe it is valuable to look back and see how North Carolina did economically speaking in recent years. Some say we made very little progress at all. Did we? N.C. State University economist Mike Walden responds.
“Well, there are many ways to measure economic progress. … One of the ways that economists most rely on is to look at the value of what is produced in a state or a country and how that changes over time. And if we look for example of North Carolina versus the U.S. from 2000 to 2007 — the production of income, the production of goods and services in North Carolina increased 20 percent. The increase for the nation was 17 percent. So we actually grew faster than the nation from 2000 to 2007.
“Now, of course, 2007 was the start of the recession, and in 2008 and 2009 we had a contraction in the economy and our economy dipped by 4 percent. But that still left us higher still than the nation, even after the recession. That is to say, even taking into account the recession, our economy today in North Carolina is bigger and has had a bigger growth rate than the nation.
“Now one question that people may have is, ‘Well, if we grew faster than the nation, why have we had so many problems generating jobs?’ And we have recently seen job generation growth slower in North Carolina than in the U.S. And the answer to that — and it is somewhat of a good answer, but it has a negative backfire, if you will — is that we have gotten greater productivity out of our workers. Our workers are working harder. They are producing more per hour and per worker. Therefore, we don’t need as many new workers to produce the greater output. So that is actually good for our efficiency. It is obviously bad for the number of jobs.”
Category: Economic Perspective