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Region’s Economy Grows, Employment Stagnant

Oct. 10, 2012. Economic growth continued in western North Carolina in August, however labor figures continue to be dismal. According to the Western North Carolina Economic Index, economic activity increased by 0.4 points in August, the fourth monthly increase in a row.

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

“This is the strongest four-month period since before the recession,” said CERPA director Dr. Todd L. Cherry, who also is a professor of economics at Appalachian.

“But I remain cautious because there are too many pressing issues outside the region that can affect us,” he said. “We’ve seen some positive labor market news at the national level, but some worrying news about the prospects for the global economy. We can be more confident about the regional economy when we see the gains in activity translate to improvements in the regional labor market.”

According to the report, seasonally adjusted employment for WNC increased slightly, by less than 0.1 percent in August, reversing the previous month’s decrease. 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. The volatility in seasonally adjusted county-level employment across the region during the month was striking, falling in 11 of the 25 counties. McDowell, Caldwell and Alexander counties had the largest employment gains with 1.1, 0.5 and 0.5 percent increases, respectively, while Alleghany, Avery and Graham had the largest losses with 1.5, 1.3 and 1.0 percent decreases, respectively.

Seasonally adjusted WNC unemployment registered 10.0 percent in August – showing no change from July, and down 1.2 points from one year ago. The state unemployment rate increased to 9.7 percent while the national rate fell 0.2 points to 8.1 percent.

The seasonally adjusted unemployment rate within the region’s rural counties increased by 0.1 points to 11.3 percent in August. In the region’s metro areas, unemployment remained unchanged in both Asheville and Hickory-Morganton-Lenoir. 

County-level seasonally adjusted unemployment rates were highest in Graham, Swain and Rutherford counties with rates at 17.1, 14.9 and 14.2 percent, respectively. Rates were lowest in Buncombe, Henderson and Polk counties at 7.6, 7.6 and 7.9 percent, respectively.

Seasonally adjusted unemployment rates decreased in 11 of the 25 WNC counties. Jackson, Alexander and Madison recorded the largest decreases in unemployment rates with a 0.3, 0.2 and 0.2 point decrease, respectively. Swain, Ashe and Avery had the largest increases with a 0.9, 0.6 and 0.3 point gain, respectively.

Looking at the last 12-month period, all but one WNC county experienced decreases in unemployment. Unemployment rates in Burke, Catawba and Caldwell decreased the most over this period by 2.5, 1.9 and 1.9 points, respectively while only rates in Mitchell increased by 0.6 points.

Seasonally adjusted initial claims for unemployment insurance in the region, a leading indicator of unemployment, decreased by 12.7 percent in August. Initial claims decreased 4.0 percent in Asheville and 17.0 percent in Hickory-Morganton-Lenoir.

The WNC Economic Index and Report is a cooperative effort by the Center for Economic Research & Policy Analysis at Appalachian State University and Advantage West. The report is compiled and written by Dr. John W. Dawson, an associate professor in Appalachian’s Department of Economics, and Dr. O. Ashton Morgan, an assistant professor in the department.