Don’t believe the hype: HB2 hasn’t hurt N.C. economy

Gov. Pat McCrory and other state officials in July announced a new CSX intermodal project projected to create 1,500 N.C. jobs.
Gov. Pat McCrory and other state officials in July announced a new CSX intermodal project projected to create 1,500 N.C. jobs. Courtesy the governor’s office

From Andrew Heath, Gov. Pat McCrory’s state budget director, in response to “Tech leader: We’re ‘horrified’ by HB2” (July 30 Opinion):

One of the benefits of being the Budget Director is that I am a numbers guy, not a politician. I am asked by credit rating agencies and various groups to give updates on North Carolina’s economy, and I occasionally get questions about the Public Facilities Privacy and Security Act (HB2).

My response is that I leave it to the politicians to debate the merits of HB2, but I also point out that this is a national issue over which millions of people are split.

It is an issue that will be resolved in the courts, and I maintain that HB2 is an election-year political issue rather than an economic issue.

The HB2 questions are generally fueled by a false narrative that the law is having a devastating economic impact.

This narrative has been so consistently pushed by advocacy groups that people are having an emotional response to it rather than basing what they believe on facts.

In the budget office, however, we are data-driven and do not base our positions on emotion, anecdotal evidence or speculation about the state’s reputation in elite circles.

Major economic indicators overwhelmingly show North Carolina’s strong economic performance both before and after HB2. Under Gov. McCrory’s leadership, North Carolina has one of the fastest growing economies in the nation.

Regardless of one’s position on HB2, one must conclude based on the facts that any purported fallout from HB2, which is mostly speculative and unquantifiable, pales in comparison to the actual economic impact of the pro-growth policies that have led to the creation of 300,000 net new jobs since 2013. These policies have continued to benefit the state.

Here are some relevant facts since HB2 took effect:

▪ Nearly 5,000 new jobs have been announced since March.

▪ Moody’s reported that North Carolina’s 2016 year-to-date revenue growth has outpaced the 20 largest states’ average by more than 2-to-1.

▪ North Carolina’s unemployment rate returned to pre-recession levels at 4.9 percent and is down in all 100 counties since 2013.

▪ S&P, Moody’s and Fitch affirmed North Carolina’s AAA credit rating, citing the state’s continued diverse economic expansion.

▪ CNBC moved North Carolina from #9 to #5 in the ranking of best states for business.

▪ North Carolina ended the fiscal year with a $425 million revenue surplus.

The entertainers and businesses who have chosen to cancel shows, games or jobs as a form of political speech are free to do so, but those few actions will not affect the state’s overall economic position. The vast majority of entertainers, athletes and businesses are not falling for the false narrative.

While this issue is being addressed in the courts, the world still turns. North Carolina businesses continue to grow, and our tax revenues continue to beat expectations.

Meanwhile, I will continue to report positive economic news, and identify HB2 for what it is – an election-year political issue.