Economist: N.C. growth in 2010 sluggish, better in 2011

Published 12:55 pm Friday, September 17, 2010

The North Carolina economy will grow by 0.8 percent in 2010 compared to last year, according to UNC Charlotte economist John Connaughtons latest quarterly report. While the increase is modest, its a marked improvement from the 2.7 percent decline in Gross State Product (GSP) in 2009. Connaughton is forecasting further improvement in 2011 with an expected increase of 2.7 percent in the states GSP compared to 2010.

Connaughton has lowered growth forecasts in the state for this year after seeing sluggish growth in the first quarter. He reports the North Carolina economy grew during the first quarter by an annualized rate of 0.2 percent, well below the national growth rate.

The first quarter GSP performance was considerably weaker than the U.S. GDP (Gross Domestic Product) increase of 3.7 percent, Connaughton noted. The national economy has been able to put together four consecutive quarters of expansion, while the North Carolina economy has struggled to put two quarters of growth together.

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During the second quarter, Connaughton expects Gross State Product to increase by an annualized rate of 4.2 percent. Growth is expected to slow in the second half of the year, with an increase of 2.6 percent in the third quarter and 3.2 percent in the fourth quarter.

The states economic growth during this time has only been sufficient to stem job losses, but not enough to generate job growth, says Connaughton. Although there is little likelihood of a double dip during the second half of the year, the economy will continue to be sluggish enough that to many people it will feel like a return to recession.

The UNC economist says seven of the states 11 economic sectors are expected to experience increases during 2010. The sectors with the expected strongest increases are: agriculture (7.7 percent); services (4.1 percent); mining (3.4 percent); government (3.1 percent); retail trade (1.9 percent); and transportation, warehousing, utilities and information (1.5 percent).

Connaughton reports the state is expected to gain 37,400 net jobs this year, an increase of 1.0 percent over 2009. The 2010 job gains come after a loss of 282,000 jobs in the state during the 2008-2009 recession. For 2011, he expects further job gains with seven of the states economic sectors experiencing output increases. He forecasts the top sectors will be finance insurance and real estate (5.5 percent); services (4.8 percent), government (3.9 percent) and retail trade (3.0 percent).


North Carolina will receive $298 million in federal funding to preserve education jobs this year, according to state officials. The grant funding, part of $10 billion allocated for the current school year, is expected to help states offset budget deficits.

I commend North Carolina for being one of the first to submit their application and thank our team at the U.S. Department of Education for making funds available within a matter of days, says U.S. Secretary of Education Arne Duncan. These education dollars will help North Carolina keep thousands of teachers in the classroom working with our students this school year.


North Carolina has received $14.1 million to extend broadband Internet service in Beaufort, Hyde and Washington counties. The state has received $270 million in recovery funds to expand broadband access.

The latest funding will allow Tri-County Telephone to deploy an advanced fiber optic network with inherent capability to deliver broadband services speeds of 80 Mbps. The project is expected to benefit nearly 11,000 residents, 889 business and 32 community institutions.


The Greenville Hospital System (GHS) has approved a $1.4 billion budget that includes 221 additional jobs. Most of the new positions will be physicians and physician support staff.

The hospital system, the second-largest employer in Greenville County with about 10,000 employees, also approved a 3 percent rate increase for pharmacy, laboratory, radiology and operating room services. GHS says the increase is less than national and regional inflation rates for health care.

GHS is moving forward with a partnership with the USC School of Medicine to expand the universitys medical program in Greenville. The partnership is expected to generate more physician jobs and attract new businesses to the area.


South Carolinas first public electric vehicle charging station was unveiled this week in Greenville. The station, located in Greenvilles West End near the baseball stadium, was put in place by Greenville-based Thurso Power Systems.

I wanted to take the initiative and provide the infrastructure in our state and hopefully our region to support the transition to electric vehicles, said Thurso president Brian Edens.”

The charging station has a high-voltage connector which can top off a vehicles battery in about 30 to 60 minutes, according to Edens. He says his company will not charge for the service initially, but later plans to establish a flat rate that would be less than a $1 per gallon compared to filling up a gasoline-driven vehicle.

More of the charging stations are expected across the state. Stewart Spinks, owner of the Spinx convenience store, chain says he plans to order at least five of the electric plug-in stations from Thurso.

“You have to go out in front and show the customer that this is going to be a viable way to transport yourself and not worry about being out of fuel sometime out on the road,” Spinks said.


A shopping center in Spartanburg that houses Barnes & Noble will be auctioned in a foreclosure sale on October 4. Terry Glenn Lanford, the owner of the property, lost a $4.9 million foreclosure judgment in June to his lender, Provident Community Bank. Lanford was charged earlier this year with former Spartanburg Clerk of Court Marc Kitchens with one count each of conspiracy to distribute methamphetamine and cocaine.

The 38,000-square-foot shopping center on W.O. Ezell Boulevard also is home to Monkey Joes indoor inflatable playland. Both Barnes & Noble and Monkey Joes said they expect their leases to remain in effect following a change in ownership.


A joint venture known as the Carolina Artisan Group is expected to bring 200 jobs to Valdese. Art Van Furniture, the largest furniture retailer in Michigan, has partnered with Kellex Corporation, a furniture manufacturer in Burke County on the joint venture.

The companies plan to design and develop custom and semi-custom living room and family room seating.

We are fulfilling a consumer demand for high quality, affordable product made in America, and North Carolina is the epitome of craftsmanship in the furniture industry, said Art Van Elslander, owner of Art Van Furniture.


The 208-mile Blue Ridge Relay begins today with seven teams, consisting of dozens of runners from Western North Carolina. The race, one of the longest running relays in the country, traverses the Blue Ridge and Black Mountains of Virginia and North Carolina.

Each relay team member runs three legs of varying lengths and difficulty, covering an average total distance of about 16.6 miles.

The relay begins early Friday morning at Grayson Highlands State Park in Virginia and continues along country roads to a finish around 10 a.m. in downtown Asheville on Saturday.


The annual migration of the Monarch butterfly through Western North Carolina has begun. Some of the butterflies will travel more than 1,500 miles to the warmer climate of Mexico for the winter.

Bambi Teague, chief of resource management and science for the Blue Ridge Parkway, says the number of monarchs migrating through the region has declined in recent years because of harsh weather and a loss of habitat, but butterfly lovers can still see them this fall.

The journey south takes about two months or more for the Monarchs, which travel about 25 to 30 miles a day. Using the wind to help carry them, the butterflies can travel up to 7 miles per hour.&bsp; Millions of the butterflies make the trip from areas east of the Rocky Mountains to the high elevation fir forests in the Mexican state of Michoacan.

The peak of the migration along the Blue Ridge is usually seen near the autumnal equinox and gradually tapers off through October. To track the reported migration, visit