Has the NC economy recovered from COVID-19? A look using QCEW data.
This blog article compares the latest quarterly census of employment wages (QCEW) (third quarter of 2021, future 2021 Q3) and compares it with its pre-pandemic analogue (third quarter of 2019, future 2019 Q3) to understand the impact of COVID- 19 at North Carolina employment and wages at the industrial sector level.
How has the economy changed in NC? Total industrial employment reached 4,515,068 in the third quarter of 2021, a slight increase of 1% from the level in 2019. In the same period, even after adjusting for inflation1, the average weekly wage increased by 8%. During the same period, the United States experienced a decline in employment (-3%), while real wages grew by 8%.
North Carolina saw employment growth in more than half of the industrial sectors. Transport and warehousing added the most jobs, nearly 30,000, while Finance and Insurance added more than 22,000 jobs.
Employment growth in the NC Industry Sector, 3rd quarter 2019 to 3rd quarter 2021
Source: Chart generated by LEAD staff using data from the Quarterly Census of Employment (QCEW), 3rd quarter 2019 and 3rd quarter 2021A more detailed look at a selection of these industries reveals an interesting nuance to North Carolina’s economic recovery. The table below shows that the struggle to return to pre-pandemic employment levels coincided with the growth in real wages for all selected industries during the period:
| Industry Sector | Employment 3rd quarter 2021 |
% change in Employment, Q3 2019 – Q3 2021 |
Avg. weekly Pay 3rd quarter 2021 |
% change in Real salary, Q3 2019 – Q3 2021 |
| In all, all industries | 4,515,068 | 1% | $ 1,111 | 8% |
| Professional, scientific and technical service | 293,359 | 10% | $ 1,805 | 6% |
| Retail | 512,812 | 1% | $ 681 | 13% |
| Health Care & Social Assistance | 627,647 | -1% | $ 1,135 | 9% |
| Manufacturing | 464,582 | -3% | $ 1,236 | 3% |
| Accommodation and food service | 409,413 | -9% | $ 434 | 14% |
Looking at national trends for these industrial sectors in the table below, it shows that North Carolina is recovering faster than the United States in terms of employment, but is lagging behind in real wage growth for Professional, Scientific & Technical Services and Manufacturing.
| Industry Sector | % Change, NC Employment Q3 2019 – Q3 2021 |
% change, USA Employment Q3 2019 – Q3 2021 |
% Change, NC Real wages Q3 2019 – Q3 2021 |
% change, USA Real wages Q3 2019 – Q3 2021 |
| In all, all industries | 1% | -3% | 8% | 8% |
| Professional, scientific and technical service | 10% | 4% | 6% | 8% |
| Retail | 1% | -1% | 13% | 13% |
| Health Care & Social Assistance | -1% | -2% | 9% | 7% |
| Manufacturing | -3% | -4% | 3% | 5% |
| Accommodation and food service | -9% | -10% | 14% | 11% |
This analysis tells us that North Carolina has experienced a rapid recovery from the COVID 19 pandemic, but it is uneven and incomplete. Several key sectors lack their pre-pandemic employment levels. NC’s real wages have risen in all industrial sectors, but are lagging behind national increases in manufacturing and professional, scientific and technical services. As additional datasets become available, we will better understand the changes in our economy.
Method
Why did we choose to highlight these five industries? They provide more than half of all jobs in NC – Health Care & Social Assistance (13.9%), Retail (11.4%), Manufacturing (10.3%), Accommodations & Food Services (9.1% ), Professional, Scientific and Technical Services (6.5%). Professional, scientific and technical services added the most employment of any NC industry between 1990 and 2020 and increased by 218%.
Footnote
1Adjustment performed using the Bureau of Economic Analysis’ personal consumption expenditure index.