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May 06, 2009

Is North Carolina importing unemployment?

North Carolina's unemployment rate has more than doubled in just over a year, and we're now one of the leading states in the nation in unemployment. Some analysts have said one reason for these results is that the state is importing unemployment. First, what does this mean? And second, is it accurate? Listen

Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:

"Well, what it means is simply that people are moving here in search of jobs because they've heard in recent years that North Carolina is a great place to find a job. They get here, though, and they find that North Carolina is in a recession just like every other state. The jobs aren't available, and so they go on unemployment. And they get unemployment insurance, they get Medicaid and all the other services. And so there's a concern that, indeed, people are coming here because of this job search, and they're going on the unemployment roles, and ergo, we are importing unemployment. Now, whether it's accurate . . . well, on one hand, yes it is. If you look at the increase in North Carolina's labor force, the number of people here who are either working or want to work since the recession started, it has increased six times faster here in North Carolina than it has in the nation. So we are having more people move here, more people coming into our labor force. So I think the issue does have merit, but on the other hand, it's not an new issue. It's actually a recurring issue. If you go back to the last five recessions, you see the same thing, that we've had a bigger expansion of our labor force here in North Carolina than the nation. So I do think we are importing unemployment during this recession, but it's not a new issue. We always have during previous recessions."

Posted by Dave at May 6, 2009 08:00 AM