By George Shaw
This column builds on recent articles on employment and unemployment in the Wake County area. Although COVID-19 is abating and our economy is improving, food security will remain a significant issue. Our communities responded very generously in the last fifteen months. There are many things that you can do to continue to help.
Impact of COVID and the Economic Recovery
The outlook on employment was increasingly positive in the May 28 article for the Wake Forest Gazette. Since then, Wake County has reported a drop of the unemployment rate to 3.6% for April 2021 which is nearly equal to the rate of 3.5% in March 2020 when COVID began to impact our economy.
The reduction in our area’s unemployment rate masks several issues. The stated rate understates the full measure of unemployment if you add in those discouraged from looking for a job or working part time. This alternative measure reflects a current unemployment rate of 7-8% for Wake County.
Also, although the unemployment rate declined in April, employment was flat in Wake County in April while the total labor force declined by 1500. Also, non-farm employment grew only 2800 with half of the increase coming from the government, not the private sector.
In addition, recovery in employment in Wake County has been uneven. Total employment is down 5.8% for April 2021 when compared to the broader measure of the labor force described above. Categories paying above average wages are down 2.5% over the last twelve month; those paying less than average are 7.4% less than a year ago. Leisure & Hospitality is the lowest paying of the major categories – employment remains down 23% compared to the prior April.
The pace of economic recovery is likely to remain uneven for the balance of 2021. The number of open positions is at a record high nationally according to the Job Openings and Labor Turnover Survey (JOLTS) of the US Bureau of Labor Statistics. Nearly 40% of the increase in openings in April were from Leisure & Hospitality. This sets up a dynamic where employment remains well below pre-pandemic levels but the number of vacancies is increasing.
The unemployment rate is forecast to continue to decline to around 4.5% or lower nationally by the end of the year. The national unemployment rate was 6.1% in April and dropped to 5.8% in May.
The unemployment rate dropped to 3.0% by January 2021 in our area. Wake County’s rate may equal that low level by the end of this year. However, the recovery in lower paying jobs is likely to lag through 2022 and potentially beyond. And 10% of lower paying jobs may disappear due to increased automation as well as firms that have gone out of business.
The Need in Our Communities
More than 15% of the population of Wake County earned less than the poverty level (about $25,000 per family of four annually) or was classified as working poor before COVID-19. This figure is currently closer to 20%, both across the county as well as in our immediate area.
Although the economy is expected to show recovery during the second half of the year, there are several wildcards that may cause a significant increase in demand for our food security programs:
o End of the eviction moratorium on June 30. According to the publication “Government Executive,” a lower court struck down the ban last month. Attorneys general from 22 states including North Carolina asked the Supreme Court not to end the moratorium. If the moratorium ends, the impact on homelessness as well as food security may be very significant.
o End of the unemployment checks. The federal program is scheduled to end on September 6.
o Rising inflation. Kiplinger forecasts that the inflation rate will be 5% for 2021, eroding the purchasing power of consumers. A particular concern for the needy is the rise in the cost of rents. “Apartment List” tracks average monthly increases in rents by major metropolitan area. Wake County’s average increase in rent was 3% from April to May 2021 as well as around 7% for the last twelve months. The more that those in need have to pay for housing, the greater the likely need additional food assistance.
Response to the Need
Our local programs distributed food to more than 3,500 clients in March 2020 as the pandemic began its impact. The total for March 2021 was roughly the same, primarily because of a roughly 15% reduction in capacity due to closures and reduced schedules. The number of clients served in April was down approximately 8% from March as stimulus checks and other support programs were received by those in need. The figures for May have declined roughly 3%, largely because of a large one-time food distribution event in April that was not repeated last month.
Several distribution programs plan to expand their schedule of service in June. In addition, the food hub of the Northern Wake Food Security Team (NWFST) distributed more than 1,300 boxes of produce and shelf stable food in May as well as significant quantities of eggs, bread and milk to eight pantries and distribution programs. Their funding has been extended until the end of 2021.
What Can You Do To Help?
o Donate shelf stable food and hygiene products. Many local organizations have donation drives. You can also drop these off at local pantries.
o Donate money. Funds are often more useful than supplies as pantries can fill in gaps in canned goods or purchase fresh produce. And they can generally purchase at lower prices than you would pay at the grocery store.
o Volunteer at distribution events. There are currently constraints at most food distribution partners but today’s Executive Order will facilitate having more volunteers.
o Grow. If you have a veggie garden, why not grow an extra row and donate it to a local pantry.
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