N.C. economic indicators dip but still show growth

Published 10:35 am Friday, September 9, 2011

Four of five leading economic indicators slipped in North Carolina in July, lowering the economic forecast for the next several months by 0.8 percent, according to the Walden Index issued by N.C. State University economist Michael Walden. The economic indicators in the index were the lowest they have been this year in North Carolina.
Despite the drop, Walden said he was not predicting a double-dip recession in the state. Walden noted that the index in July was still up 1.5 percent over July of 2010.
“I’m still in the camp that thinks we’ll avoid an ‘official’ recession by keeping GDP (gross domestic product) growth just above negative rates – that is low but still positive,” he said.
UNC-Charlotte economist John Connaughton also continued to forecast growth over the remainder of the year, although he lowered his estimates made earlier in the year.
Connaughton previously forecasted growth of 2.7 percent for the year, up from 2.6 percent in 2010. However, he is now calling for 1.7 percent growth this year.
“Overall, the North Carolina economy suffered through a modest recovery during 2010 and the first half of 2011,” says Connaughton, whose forecast is funded by Babson Capital Management.
The UNC economist also lowered his estimates for job creation this year from 64,700 to 23,600. The North Carolina economy is estimated to have lost 320,000 jobs during the recession in 2008 and 2009.
Connaughton says he expects the strongest growth prospects will be seen this year in three sectors: finance, insurance and real estate (up 2.9 percent); wholesale trade (up 2.8 percent); nondurable goods manufacturing (up 2.7 percent).
He expects more limited growth in durable goods manufacturing, retail trade, transportation, warehousing, utilities and information and government.
– sources: “Charlotte Business Journal,” 9-7-11; Raleigh News & Observer, 9-6-11
August was a big month for job announcements in North Carolina, according to the Impact Report of “Site Selection” magazine.
The publication, which tracks announcements of new plants and expansions, reported that North Carolina accounted for nearly 20 percent of all new jobs announced in the country in August. According to “Site Selection,” companies announced in August plans to bring 1,276 jobs and $306 million in investment to North Carolina.
The job announcements came in a number of small to medium-sized projects, including one by Merck and Company, a biotechnology company that plans to invest $91 million and create 75 jobs.
Specialty Textiles, Inc. also announced in August plans to invest $4.9 million and create 62 jobs by expanding a manufacturing facility in Cleveland County for residential upholstery fabrics.
Although the job announcements in North Carolina were about 18 percent of the total number of jobs announced nationwide in August, the investment figures announced for North Carolina  represented only about 3.4 percent of the nationwide total for the month.
– sources: www.thrivenc.com (N.C. Department of Commerce), 9-2-11
Thermo Fisher Scientific announced at the beginning of this month that it plans to bring 110 jobs to the Asheville area in the next seven months.
The company, which manufactures ultra-low temperature freezers and other products for pharmaceutical, biotech and research institutions, said the new positions will support its manufacturing and assembly of high-efficiency cooling pumps, which control temperature in Thermo Fisher Scientific products.
Thermo Fisher already employs 580 people at its Aiken Road plant and has more than 200 people in its technical customer service center in Biltmore Park.
Buncombe County board chairman David Gantt noted that Thermo Fisher Scientific is a Fortune 500 employer with operations in more than 40 countries.
“We’re grateful to local company leaders and staff for their strong work ethic and competitive spirit that brought this opportunity home for the citizens of Buncombe County,” said Gantt.
– source: www.citizen-times.com, 9-7-11
Democrats in the N.C. House lead a rally Tuesday to build opposition to a proposed constitutional amendment banning same-sex marriage in the state.
Democrats say the amendment, if passed, would hinder future economic development efforts by sending a message that North Carolina does not welcome a diverse population. Democrats say it could deter some companies from locating or expanding in the Tarheel state and make it more difficult for companies to recruit employees.
House Republicans have rejected those claims. Dale Folwell, the number two Republican in the House, said the constitutional amendment will not impact business recruitment.
“If any business is making a decision about whether to come or leave North Carolina on this issue… I think that’s an incorrect way to be making a business decision,” said Folwell.
Joe Hackney, the Democratic leader in the N.C. House who led Tuesday’s rally, supported a 1996 North Carolina law that made same-sex marriage illegal in the state. However, he says he would not vote the same now.
“I think people change, cultures change,” said Hackney Tuesday. “Our predecessors 50 years ago, 100 years ago, were perfectly content with Jim Crow laws they enacted.”
Hackney added he believes there is a difference between passing a law against same-sex marriage and putting a “discriminatory message” in the state’s constitution. Currently, North Carolina is the only state in the South that does not have in its constitution a prohibition of same-sex marriage.
Passing the constitutional amendment will require approval from three-fifths of both the House and the Senate to get it on the ballot for next year. The referendum then would have to be approved by more than half of voters.
– sources: www.newobserver.com and Winston Salem Journal, 9-7-11
Superior Court judge Howard Manning rejected a motion by North Carolina Republicans asking him to reconsider his ruling that the state should maintain funding for pre-kindergarten education.
Although education funding was increased in some areas, The budget approved by a Republican-led General Assembly earlier this year reduced funding for pre-K programs, limiting the number of 4-year-olds who could enroll in the programs.
Manning reiterated Friday that the state’s constitution requires the lawmakers to provide a quality education to all children.
“The court remains confident that the state of North Carolina will discharge its constitutional duties to the children of North Carolina, including ‘at-risk’ prospective enrollees, so that each child may have the equal opportunity to obtain a sound basic education,” Manning said.
At the request of Republican lawmakers, the North Carolina Attorney General’s Office is appealing Manning’s ruling. Republicans have argued that the state’s constitution provides the authority for the legislature to set education policy.
While funding for pre-K programs was cut, Republicans have noted that education funding was increased this year in other areas.
N.C. Governor Bev Perdue applauded Manning’s ruling and said she has directed the N.C. Department of Health and Human Services to formulate a plan for complying with the order.
“Providing at-risk children with access to an academic pre-kindergarten program helps prepare them for success in elementary school and throughout their lives,” Perdue said.
– sources: www.newsobserver.com, 9-7-11; www.governor.state.nc.us/
The I-26 Asheville Connector project, and other urban loop road projects, will move ahead sooner than expected thanks to low-interest federal Grant Anticipation Revenue Vehicle (GARVEE) bonds, according to Governor Bev Perdue.
The governor announced plans this week to use the bonds to accelerate construction schedules by two years or more for at least six road projects in the state.
Other projects affected by the plan are located in Winston-Salem, Wilmington, Fayetteville, Greenville and Greensboro.
The GARVEE bonds allow the state to make early use of federal highway money expected in the future. State officials say it makes sense to use the bonds because construction costs are expected to be higher in future years so the state will save money by using the funds now, even with the cost of interest on the bonds.
“Investing in our state’s infrastructure is about jobs,” said Perdue. “Not only will it create jobs, but it also will build an efficient transportation network that will attract new businesses and bring more jobs to our state in the future.”
The I-26 Connector Project in Asheville involves widening I-240 from four to eight lanes between the I-26/I-40/I-240 interchange to a point between Haywood Road and Patton Avenue. The project had been on hold because of lack of funding, but the state says it now plans to start buying land for the widening in 2018 and begin construction in 2020.
– sources: www.citizen-times.com; www.newsobserver.com, 9-7-11
Losses continue to mount in North Carolina as a result of damages from Hurricane Irene. The governor’s office reported that preliminary damage assessments have topped $400 million.
Most of the losses so far are expected in agriculture crop damage ($320 million), followed by local government costs ($45 million) and damage of uninsured or underinsured residential and commercial property (more than $40 million).
Gov. Perdue has asked U.S. Agriculture Secretary Thomas Vilsack to expedite a major disaster declaration for 43 counties in Eastern North Carolina to help producers there stay in business.
The hurricane caused extensive damage to numerous crops in the state, including corn, cotton, peanuts, sweet potatoes, poultry, swine and tobacco. Farm buildings, machinery and equipment also suffered damage from the hurricane, making it difficult for some producers to remain in business without assistance, according to the governor’s office.
“Extreme drought had already withered crops and delayed harvests, resulting in even greater hurricane damage that might otherwise have occurred,” wrote Perdue in a letter to Vilsack.
– source: www.governor.state.nc.us, 9-2-11
Most of Western North Carolina avoided significant flooding from the remnants of Tropical Storm Lee earlier in the week. Rainfall totals ranged from less than a couple inches in the Foothills to close to a half foot of rain in far western areas of the state.
Murphy and Linville reportedly received 5.13 and 4.75 inches of rain, respectively, from the storm. Asheville received 3.2 inches, while Brevard had 3.65 inches and Hendersonville 2.07 inches, according to totals from the National Weather Service and the Community Collaborative Rain, Hail and Snow Network.
– source: wwww.citizen-times.com, 9-6-11
Home sales are on the rise in the Charlotte area. The Charlotte Regional Realtor Association reported a 26-percent jump in home sales in the 10-county area during the month compared to a year ago. A total of 2,289 homes were sold in August, which was also 5.3 percent higher than the total in July.
However, the average sale continued to show weakness. The realtor association reports the average sales price in July was $205,915, down 9.2 percent from August of 2010 and 3.5 percent from July of this year.
– source: Charlotte Business Journal, 9-7-11
The population of the Charlotte metro area passed 1.8 million for the first time, according to an analysis by “On Numbers,” a publication by “The Business Journals.”
The 2010 census showed the Charlotte metro area had a population of 1,758,038 as of April 1, 2010. Using a computer program to project population, On Numbers estimates the metro area has since added 61,748 residents, making it the 33rd-most-populous metro area in the country.
The city ranks behind the San Jose-Sunnyvale-Santa Clara, Calif. metro area and ahead of Austin-Round Rock-San Marcos, Texas.
– source: Charlotte Business Journal, 8-29-11

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