N.C.’s unemployment rate rises to 5.4% in March

North Carolina’s unemployment rate rose a notch to 5.4 percent in March as tens of thousands of people entered the labor force in search of work.

The Labor and Economic Division of the N.C. Department of Commerce reported Tuesday that the unemployment rate rose one-tenth of a percentage point from 5.3 percent in February. A year ago, the state’s unemployment rate stood at 6.4 percent.

The national unemployment rate was 5.5 percent in March, the same as in February.

“I would ignore the rise in the (state) unemployment rate because it is totally due to a large influx of people coming back to the labor force,” said N.C. State University economist Michael Walden.

The monthly survey of households found that the number of people employed rose by 26,012, which Walden called “a very strong increase.” At the same time, however, the number of people unemployed in the state rose by 5,926 in March to 253,510.

That seemingly contradictory data is an indication that people who previously had been too discouraged to look for work have re-entered the job market.

The monthly survey of North Carolina employers actually found that the number of jobs in the state fell by 2,600. It’s not unusual for the data from the household survey and the employer survey to conflict, since both are based on sampling.

The month-over-month decline in jobs in March, according to the employer survey, was led by a loss of 2,400 construction jobs and 1,800 financial activities jobs. Other sectors losing jobs included education and health services and government, both of which declined by 1,100 jobs.

On the upside, the state added 2,700 professional and business services jobs and 2,100 jobs in the trade, transportation and utilities sector. Manufacturing jobs grew by 1,000.

Rick Kaglic, a Charlotte-based senior regional economist for the Federal Reserve Bank, noted, however, that one month does not make a trend.

“We’re seeing more labor force growth here in North Carolina and in South Carolina than we are for the nation as a whole. In the short-term, that puts upward pressure on the unemployment rates, but in the longer-term, it allows the economy and importantly, job growth, to advance at a faster pace as well,” Kaglic said in a call with reporters Tuesday.

In South Carolina, the unemployment rate rose to 6.7 percent in March from 6.6 percent in February, the state’s Department of Employment and Workforce reported.

The rate of employment growth in the Carolinas, Kaglic said, still exceeds the nationwide average in year-over-year comparisons. While the U.S. has experienced 2.3 percent job growth over the year, North Carolina has had 2.8 percent growth and South Carolina has had 2.5 percent growth.

The Labor Department reported earlier the U.S. economy added 126,000 jobs in March, snapping a 12-month streak of job gains over 200,000.

In the Charlotte area, the unemployment rate was 5.5 percent in February, the most recent month for which data is available.

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