If you know how to decode and supplement it, Cheris Hodges’ toe-dip into the murky waters of local employment in Creative Loafing is very revealing. Turns out Official Charlotte has moved the goal posts on jobs. In fact we evidently are settling for fields goals from now on.
Hodges starts out by asking if we keep seeing all these announcements for new jobs coming to town, why is regional unemployment still 11.1 percent? The simple boring answer is that takes time to replace 54,000 jobs in 100 or 250 job increments. But Hodges instead trudges to the Rent Seekers Guild and the city development officials for answers — and gets some gold.
The Guild does not know — advising it’ll take “at least a year” for things for improve materially on the local employment rate. The city seems more specific, if guarded, five years until full employment. But what is full employment? Quite a bit less than it once was for Charlotte:
Brad Richardson, economic development manager for the city of Charlotte, said what we’re experiencing right now is a jobless recovery. … “The bad news is, it may be a five-year window before we see full employment, which is somewhere around that 5 percent, 6 percent number,” he said. “We have a long way to go.”
With 5.5 to 6 percent unemployment, this standard of full employment is roughly double the local unemployment rate during the big boom years. From 1994 thru 2000 state employment commission data say local unemployment averaged 3.3 percent. Then came the 9/11 shocks which slowed the national economy and saw the local unemployment rate bump above 6 percent in 2002 and 2003. Then from 2004 thru the start of the recession in mid-2008 the rate fell back down to 5 percent.
All rolled up and including at least 10 quarters of recession, from 1994 thru 2008 the metro jobless rate averaged 4.48 percent — but now normalcy is defined as unemployment rates up to one-third higher than that? We sure about that? Because if we are it portends some big things for local government.
That 15 year window pre-recession set the revenue growth expectations for local government. In sum, the city of Charlotte would not have all those six-figure jobs and subsidized development projects without the years of 3 percent unemployment. But if those years are gone for good something has to give. I’m guessing it will not be the six-figure jobs — not by the fact that city staff just found $6.1m. for staff raises and $12m. to build a staff-beloved streetcar.
And I surmise Mecklenburg County will deny reality — starting with the ongoing property tax reval — for as long as possible to avoid taking additional whacks out of CMS, DSS, and other discretionary pots. If so county homeowners are staring at property massive tax increases in 2011.
And yet more:
Richardson, however, doesn’t expect that the lower-skilled manual labor jobs that the city lost will return during the economic recovery.
“When we lose those,” he said, “they don’t come back. They go to cheaper places around the world to do business.”
Or get scooped up by local make-work projects, paid for with declining local revenue. Or — jump on social service programs funded by the county. It all comes back to the same place — a shrinking private sector straining to support a public sector that grew out of control during the fat years and has yet to come to grips with the new reality.
