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Regional Economy Posts First Gains in Three Months

July 20, 2012. The month of May was a bit kinder for the economy in Western North Carolina. Economic activity, as measured by the Western North Carolina Economic Index, increased by 0.4 points in May, halting three consecutive months of decreases in the index.

The index, compiled by the Center for Economic Research and Policy Analysis (CERPA) at Appalachian State University, tracks the level of economic activity in 25 western North Carolina counties.

“The latest index shows a jump in regional economic activity, but the numbers are mixed in the labor market. Overall, the numbers indicate the recovery continues to be slow and bumpy,” said Dr. Todd Cherry, CERPA director. “Job growth was flat but there were gains concentrated in the High Country in Northwest North Carolina and the Asheville metro areas.” 

Variability remains the theme for the 25-county region.

“Conditions vary dramatically across the region, which is highlighted by county-level unemployment rates ranging from 7.1 to 17.1 percent,” Cherry said.

Seasonally adjusted employment for WNC decreased slightly—by less than 0.1 percent in May, providing the third consecutive month of decreases. Statewide adjusted employment decreased by 0.1 percent.

Mapping the growth in employment over the preceding month provides a county-level account of job creation. Changes in seasonally adjusted county-level employment during the month remains mixed across the region, rising in 16 of the 25 counties. Alleghany, Yancey and Graham counties had the largest employment gains (with 1.0, 1.0 and 0.9 percent increases, respectively), while Alexander, Transylvania and Catawba had the largest losses (with 0.5, 0.4 and 0.3 percent decreases, respectively).

Seasonally adjusted WNC unemployment registered 9.8 percent in May – up 0.2 points from April. The state unemployment rate remained at 9.4 percent, while the national unemployment rate increased by 0.1 point to 8.2 percent.

The seasonally adjusted unemployment rate within the region’s rural counties increased by 0.2 points to 11.1 percent in May. In the region’s metro areas, unemployment increased by 0.2 points in both Asheville and Hickory-Morganton-Lenoir to 7.6 and 10.9 percent, respectively.

County-level seasonally adjusted unemployment rates were highest in Graham, Rutherford and Swain counties (with rates at 17.1, 14.1 and 13.7 percent, respectively). Rates were lowest in Henderson, Buncombe and Polk counties (at 7.1, 7.5 and 7.9 percent, respectively).

Seasonally adjusted unemployment rates increased in 22 of the 25 WNC counties. Yancey, Graham and Ashe counties recorded the only decreases in unemployment rates (with a 1.3, 0.4 and 0.3 point decrease, respectively). Alexander, Cherokee and Caldwell had the largest increases (with a 0.6, 0.4 and 0.4 point gain, respectively).

During the past 12-month period, all but seven WNC counties experienced decreases in unemployment. Unemployment rates in Burke, McDowell and Catawba decreased the most over this period (by 2.2, 1.6 and 1.6 points, respectively) while rates in Transylvania, Avery and Madison all increased (by 0.3 points).

Seasonally adjusted initial claims for unemployment insurance in the region, a leading indicator of unemployment, decreased by 1.0 percent in May. Initial claims increased 8.0 percent in Asheville and 6.2 percent in Hickory-Morganton-Lenoir.

The full WNC Index and Report for May is online at http://cerpa.appstate.edu.

The WNC Economic Index and Report is a cooperative effort by CERPA and Advantage West. It is compiled and written by Dr. John Dawson, an associate professor in Appalachian’s Department of Economics, and Dr. Ash Morgan, an assistant professor in the department.