Michael L Walden, PhD and William Neal Reynolds distinguished professor from NC State University, recently provided his opinion to North Carolina Construction news regarding the future of North Carolina’s economy. Dr. Walden believes that even though North Carolina economy is still shy of pre-recessionary levels, the state’s economy will accelerate soon. He believes there are four factors that will contribute to North Carolina’s economic boom, which are a manufacturing revival, a construction surge, and education “bumper crop” and a retiree influx.
According to Dr. Walden, “Almost twice as much of North Carolina’s aggregate economic output comes from manufacturing as in the nation”. During a recession, manufactured goods purchases can be postponed, so this is why N.C suffers more. This will also be the reason for the manufacturing revival however; since consumers and firms will be able to make their purchases, this will drive demand up for manufactured goods, from technology to furniture.
The next factor is the construction surge. The dip in the housing market shattered the construction industry, but according to Dr. Walden, “North Carolina has added population at twice the national rate in the last five years. Therefore, the state has more ‘catching up’ to do with new homes, apartments and retail outlets that should translate into 50,000 construction jobs by 2016”.
Then there’s the education “bumper crop”. The U.S. Bureau of Labor Statistics forecasts jobs requiring a college degree to increase 30 percent faster than all other jobs between 2010 and 2020, and N.C.’s number of graduates rose a much higher percentage than the national increase. According to Dr. Walden, “the more abundant supply of college graduates in North Carolina, combined with the state’s competitive land and labor costs, world-class universities an pleasing environment should make the state a magnet for knowledge-based firms in upcoming years”.
The fourth and final factor is the retiree influx; North Carolina has always been attractive to retirees due to the state’s beaches, mountains, dynamic cities and historic towns, but the retirement migration slowed during the recession as well, due to tight finances. But with the improved economy, the retirees’ should be migrating faster soon.
Dr. Walden believes “these four positive developments should result in at least 400,000 net new jobs in [N.C.] over the next five years, resulting in the statewide unemployment rate dropping to near 6 percent”.