Carolina job growth beats national trend

According to the US Bureau of Labor Statistics, North Carolina experienced no net job growth in July. Indeed, employers as a whole reported 3,000 fewer people on the payroll in July than in May. Year-to-year, our state's job-growth rate was just 1%. While employment figures over the 2021-24 period were skewed by COVID, North Carolina routinely experienced 1.5% to 2% annual growth in employment before the pandemic. Should we be worried about this? It depends on how you define the subject of that question. If by 'we' you mean Americans as a whole, I'd say yes. To be sure, unemployment rates remain low by historical standards. Our population is aging, with more people choosing to retire rather than remain in the labor force. And since the start of 2025, the Trump administration's tougher approach to immigration enforcement has both reduced inflows of foreign workers and motivated some illegal residents to 'self-deport,' in both cases reducing the number of new positions required each month to absorb job seekers. Partly as a result of these factors, America's labor force participation rate has been shrinking for the better part of a year. But less-robust job growth also translates into less-robust economic growth. Even in our age of automation and artificial intelligence, enterprises still need people to deliver the goods and services customers demand (including all those retirees!) The reason North Carolina leaders, in particular, ought not panic is that these employment trends are general, not particular. Even at 1% year-to-year growth, our job-creation rate exceeds that of most other states and far exceeds the national average of 0.2%. Over the longer term, mid-2016 to mid-2026, North Carolina posted a 17.3% increase in employment, larger than the national average of 9.9% and the employment gains of our neighboring states of South Carolina (17%), Tennessee (13.7%), Georgia (13.6%), and Virginia (8%). Moreover, while the constant churn of heightened competition, technological innovations, and shifting consumer preferences have resulted in the elimination of some well-paying jobs across our state, other positions have been created. Please note that the statistics I cited earlier were net employment changes. Every week, thousands of preexisting jobs disappear. During the fourth quarter of 2025, in fact, North Carolina companies eliminated more than 400,000 positions! Why don't we recall that period as some sort of economic Armageddon? Because during those same three months, companies added nearly 450,000 new positions. The net effect wasn't just more employment. North Carolinians as a whole have enjoyed income gains, not income losses. From the first quarter of 2016 to the first quarter of 2026, for example, the average weekly wage rose by 18% after adjusting for inflation. We also experienced a 20% real gain in personal income per North Carolinian over the past decade, again beating the national average and most of our neighbors. I don't discount the disappointment and dismay experienced by those whose jobs go away. Over the years, I had friends and family members displaced by the economic churn I'm describing here. They've had to refocus, reskill, and in some cases relocate. Public policy has a role to play, from financing education and training programs to reforming regulations that inhibit entering new occupations, building new enterprises, and creating new jobs. What public policy cannot do is arrest such changes in labor markets or the broader economy, Attempts to do so invariably hurt far more than they help. During North Carolina's first century as a state, the vast majority of its residents worked on farms. It wasn't until the early 20th century that agricultural jobs fell below 50% of total employment. Around 1950, manufacturing surpassed agriculture as the largest employment sector and rose to a high point of about 35% by 1970. Employment in services overtook manufacturing in 1970 and now accounts for most North Carolina jobs. Specific figures and time periods vary, but other states — and industrialized countries — have exhibited essentially the same trend. North Carolina has handled these changes better than most. John Hood is a John Locke Foundation board member. His books Mountain Folk, Forest Folk, and Water Folk combine epic fantasy and American history.