North Carolina’s economy grew faster than the nation’s in the third quarter of 2020, putting the state on track for a faster path to full recovery. But one of the biggest losers throughout the pandemic, in terms of job loss, has been within the hospitality industry.
“The impact has not been the same for all jobs,” said Michael Walden, who spoke recently at the 2021 Economic Outlook sponsored by the Moore County Chamber of Commerce, in partnership with Hicks and Associates.
Walden, a William Neal Reynolds distinguished professor and extension economist at N.C. State, presented a detailed analysis of the state and regional economy.
Jobs that require a high degree of face-to-face interactions suffered the most while other occupations, including education, government, construction and professional jobs saw far less impacts. Interestingly, he noted that there are more technology jobs in North Carolina today than there were pre-pandemic.
“With the resurgence of the virus and challenges in deploying the vaccines, the economy in the initial months of 2021 may be a little bumpy,” Walden said. “However, the index is still signalling overall improvement ahead.”
Walden predicted that by the end of 2021, the level of economic activity, production, buying and selling across the state “will be back where it was.”
But he cautioned that as the economy improves and there is job growth, and more children returning to regular in-person schooling, that there could be a jump in unemployment numbers.
“There are people sitting on the sidelines right now, not looking for work, who will be back looking. So they will again be counted as unemployed,” Walden said. “Don’t be surprised if you see a bump up in the early part of this year in the unemployment rate. That does not mean a retreat.”
Walden explained that the “COVID-induced recession” began with the national economy in a very good place. There was a low inflation rate and low unemployment and there were gains being made at the lower level of the economic ladder. These same factors are helping the economy to recover.
“However — and this point needs to be emphasized — the post-pandemic economy will be different from the pre-pandemic economy in several important ways,” he said.
Walden said the pandemic accelerated trends that were already changing the economy. This includes more domestic firms developing U.S.-based supply chains, which could help North Carolina’s pharmaceutical and textile industries.
More companies will also likely move toward technology and machines for labor, which may displace workers. Remote working is “here to stay” and will expand, Walden predicts. Telehealth and remote learning are also likely to expand and improve. And finally, where people choose to live is shifting.
This last trend was already having a noticeable impact on Moore County pre-pandemic, as the area’s high quality of life and reasonable housing costs have proven attractive to a broader demographic, including retirees, military families and young professionals.
“I don’t anticipate any changes in military trends,” Walden said, also noting that people over the age of 70 years are the fastest growing segment of the national population. “I suspect you will see continued growth...I think you might be able to grow as fast as you want to.”
“North Carolina has been viewed as a safe state in this pandemic. If you look at the various metrics, including the number of deaths and job loss, we actually look fairly good compared to other states,” he added. “If you want to grow, this pandemic could be a game changer for smaller, more remote areas.”
Contact Laura Douglass at (910) 693-2474 or email firstname.lastname@example.org