Economist: North Carolina economy rises with ‘strong gains’ as COVID declines
Relig – North Carolina economist Dr. Michael Walden says the decline in delta COVID cases is a “huge positive” for North Carolina’s economy with an improved job profile and an increase in building permits adding to growth underpinnings.
Walden, who has retired from teaching, still compiles NCSU’s monthly index of North Carolina economic indicators. He says the September report is bullish, up about 3%.
The new report shows solid gains in the index in September. “This bodes well for the country’s economy in the coming months,” Walden wrote in the report. But the flags of caution remain. He pointed out that “the challenges of inflation and supply constraints remain.”
In an interview with WRAL TechWire, Walden wrote via email that the index reflects several factors.
- “The September work report was good, which is a factor.
- “The weather is still good for construction, and timber prices have also gone down.
- “But the big positive thing is that the delta variable has gone around the corner, and that makes everyone feel better about the economy – which leads to more spending and employment.”
North Carolina’s unemployment rate has fallen by 3.1 percentage points over the past year, but much of that momentum occurred in late 2020 and early 2021. The seasonally adjusted rate fell from 7.3% in September 2020 to 5.9% in January, and then to 5% in April. Now, after about six months of slow and steady declines, the rate stands at 4.2% in September — 0.1% down from August.
“All components of the index improved, led by an 18.7% decrease in initial jobless claims and a 21.9% increase in building permits,” Walden wrote in the report.
“The index has been relatively flat for most of the year, so the month’s strong gains represent a departure from that trend. With Delta variable from Covid easing and consumers still pouring money, the organization is set for a solid Christmas buying and hiring season. The improvement in confidence should also spur more sales. individuals to return to the workforce.”
Nationwide consumer confidence is also increasing, which adds to a more positive economic outlet.
Below is a breakdown of the index by category: