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May 27, 2009
Pay cuts in North Carolina
North Carolina state employees will be taking a pay cut for the remainder of the fiscal year amounting to one half of one percent of their salary. In exchange, they'll receive some time off. How does this compare to what's happening in the private sector? Listen
Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:
"This is reflecting, unfortunately, what's happening in the private sector. Just in the last year, North Carolina's unemployment rate has doubled - exactly doubled - from 5.4 percent to 10.8 percent. This means an additional quarter million workers - 250,000 workers - have been sent to the unemployment rolls. Now if we look at what's been happening to pay and we look at pay in North Carolina only in the private sector - so not including government - we do have data that the government keeps on average weekly wages, and this shows that average weekly wages have actually been falling at an annual rate of 5 percent from late 2007, which is when the recession began, to late 2008. So the bottom line here is that, of course, state employees do not like getting their pay cut. They don't like the fact they're going to be forced to take some time off - the flexible furlough. But unfortunately this is happening in the private sector too, and it's simply a reflection of the tough times in the economy, which is affecting both private workers and public workers."
Posted by Dave at May 27, 2009 08:00 AM