Global economic and technological forces dramatically reshaped North Carolina’s economy in recent decades, shifting our economy from agriculture and manufacturing to technology and services.  

Amidst this shift, the state’s population increased steadily, especially in urban tracing the I-85 crescent running from Charlotte through the Triad to the Research Triangle area. These parts of the state have enjoyed rising incomes, even as they struggle with the infrastructure demands of the new arrivals. In contrast, many rural areas are challenged in more fundamental ways. Well-paying factory jobs disappeared in large numbers with lower-paying service sector jobs replacing only a fraction of what was lost. As a result, rural incomes have declined and many are looking – and moving – to urban areas for new opportunities.

More sustainable forms of development today must be grounded in the specific assets of communities and the regions they inhabit. “Cluster” or “place-based” approaches dictate that communities identify those assets that set them apart from other communities and regions and play to those strengths. While this shift in economic development strategy might be particularly difficult for small or poor communities, it is essential to their survival. We must design collaborative structures that support adjustment efforts and bring opportunities to all communities.

As North Carolina communities play to their individual strengths, there is growing talk in development circles about the emergence of super- or mega-regions. Global forces appear to be exerting pressures for human and other capital to concentrate in fast growing mega-regions linked by economic ties – the area between Atlanta and Charlotte, known as the Piedmont Atlantic, being one. North Carolina’s opportunity lies in the possibilities for job creation and income growth, tempered by the collaboration challenges of cooperating across state lines.

Implementing any new initiatives will require significant investments at the state and local levels, however, our current system of public finance is outdated and ill-suited to meeting our needs. We must design revenue and spending systems at the state and local levels that allocate adequate resources to high priority areas despite the inevitable ups and downs of the economic cycle. Central to success will be finding a consensus about the appropriate roles of government and the private sector in promoting development.

Economy Progress