Monitoring the economic pulse of the Triad
PROMISING GROWTH IN NORTH CAROLINA, BUT WHERE’S THE TRIAD?
The decline of communism accounts for the ravages experienced by North Carolina’s textile industry. That’s one of the more provocative reflections of a Wells Fargo Securities commentary on “employment dynamics and state competitiveness” that was issued on April 13.
“The decline of communism at the end of the 1980s brought enormous productive resources to the global marketplace, leading to a shift in labor intensive manufacturing and services to developing countries, particularly China and India,” bank economists Mark Vitner, Michael A. Brown and Sarah Watt write. “The impact has been felt most heavily in the most labor-intensive parts of the factory sector, contributing to the loss of 6.1 million manufacturing jobs since 1990. Textiles and apparel head the list of most labor-intensive industries and have lost nearly 1.3 million jobs since 1990. The losses have fallen most heavily on the Carolinas, southern Virginia, Georgia and Alabama.”
From there, the picture becomes a little rosier for North Carolina, though not particularly for the Triad. The authors identify six high-growth employment industries — finance and insur ance, professional and technical services, accommodation and food services, services other than public administration, healthcare and social assistance, and state and local government — and then apply a “shift-share” analysis to determine where these industries have expanded most robustly over the past decade.
Georgia and North Carolina come out high on the list, after Florida, whose future growth is thought to be undermined by a weakened housing market that has translated into poor worker mobility.
“North Carolina continues to augment its reputation as a home for cutting-edge research and is also becoming a major destination for national and regional headquarters,” the authors write. “Growth is being led in the state’s key technology sector. Raleigh-based Red Hat software announced plans to expand its headquarters and R&D facilities in Raleigh, creating 540 new jobs. The Charlotte region has seen a whole host of announcements recently related to the energy business, with firms such as Siemens, Babcock & Wilcox and Celgard, boosting both manufacturing and R&D jobs in the region.
Notice, not so much about the Triad.