RALEIGH- North Carolina’s unemployment rate fell to 3.4% in April 2022, after seasonal adjustment. That fell 0.1% from the revised rate the previous month, according to new data from the North Carolina Department of Commerce.
Even with tens of thousands of open positions across the state and the state’s “quit rate” remaining high, economist Michael Walden, Ph.D., warns those currently employed against the risk of changing employers due to current economic conditions.
“My practical advice to those in the workforce is to be careful not to leave an existing job for another job that is uncertain,” Walden told WRAL TechWire Today. “Over the past year, job seekers have taken over – this may end soon.”
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behind the numbers
According to the North Carolina Department of Commerce, the April unemployment rate fell 1.7 percentage points from a year ago.
This means that the total number of people employed in North Carolina has increased by more than 200,000 workers. There are 4,883,507 workers in North Carolina, according to the latest report.
While the recreation and hospitality industry has attracted an additional 4,200 workers, there are still significant challenges in this sector of the state’s economy.
Of all sectors, professional and business services roles grew the most in April, increasing by 5,500 workers for the month.
But 5,900 fewer workers are working in the construction industry than in March, according to the report. This follows a national trend of declining numbers of construction workers which could, in part, be linked to rising interest rates and rising mortgage interest rates, Dr. Gerald Cohen, chief economist at the Kenan Institute earlier this month.
Still, median home sale prices are rising, as are mortgage interest rates, so those considering buying a home may want to act quickly, WRAL TechWire reported yesterday.
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The latest report is a positive sign for North Carolina’s economy, Walden said. Not only was the total number of jobs higher than the previous month and the previous year, but the unemployment rate fell.
Importantly, Walden said, North Carolina’s labor force participation rate has increased.
“The labor force participation rate is important because it’s a measure of the labor shortage,” Walden said. “The rising rate suggests that the overall labor shortage is easing.”
But as the Federal Reserve continues to take steps to reduce inflation, economic growth could slow. Already, there are growing fears of sliding into a recession. John Connaughton, professor of financial economics at the University of North Carolina at Charlotte, gave equal odds during a virtual economic forecast held Thursday.
While Connaughton noted that he expects the Federal Reserve to continue to take action to reduce inflation, even if everything goes perfectly well for the rest of 2022, we would still see an inclusive inflation rate. between 6% and 7%.
“The faster the Fed acts and the more it raises its key interest rate, the slower economic growth will slow and the more modest job growth will be,” Walden said.
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But the Fed could take strong action, Walden said. “My personal opinion is that the Fed will have to raise its key interest rate significantly – from 1% currently – to at least 5%,” Walden said, “in order to get the inflation rate below 5%. ”
That would put the odds of a recession by the end of the year at 1 in 3, Walden said. “The Federal Reserve’s anti-inflationary policy will be the center of attention for the remainder of the year.”
Whatever action the Fed takes, Walden said, “will be a major determinant of whether the labor market continues to improve, or whether there will be a pause in that improvement.”
Job seekers, especially those looking for entry-level jobs, Walden said, could benefit from the first good offer, rather than waiting for a great one.
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