Skip to main content

UNCC Economist: 2014 Will Be "Breakeout Year" for NC

Sep 11, 2013 10:33AM ● Published by Jason Huddle

UNC Charlotte Economist, Connaughton, says 2014 will be a "breakout year".

CHARLOTTE  –  The North Carolina economy continues its slow trek to recovery, with 2014 poised to be a “breakout year,” UNC Charlotte economist John Connaughton reported today in his quarterly forecast for the state.

According to Connaughton, N.C. Gross State Product (GSP) is expected to reach a level of $480,071.0 million in 2013, a real (inflation-adjusted) increase of 2.1 percent over the 2012 level.  This growth forecast in 2013 would follow a moderate GSP increase of 2.7 percent in 2012. For 2014, Connaughton expects the state economy to increase by an inflation-adjusted rate of 3.3 percent.

“After a disappointing 2011, the state’s economy showed signs of life in 2012,” said Connaughton, the Babson Capital Professor of Financial Economics in the Belk College of Business. “During the first quarter of 2013, this moderate growth pattern slowed as a result of the fiscal measures put into place at the first of the year. However, the U.S. economy is strong enough overall to absorb the tax increases as well as the sequestration cuts that came later in the first quarter.

“Stronger growth is expected during the second half of the year as consumer confidence continues to rise,” he continued. “And, for the first time in this recovery, the housing sector is starting to show some life.”

Connaughton presented his quarterly forecast to members of the Charlotte business community and the media at a luncheon held at UNC Charlotte’s Center City campus. The Forecast is funded by Babson Capital Management LLC.

2013 Overview and Sector Outlook

For 2013, first quarter GSP increased by an annualized real rate of 0.7 percent.  During the second quarter, GSP is expected to increase at an annualized real rate of 3.0 percent. In the third quarter, GSP is expected to record an annualized real growth rate of 3.1 percent. In the fourth quarter of 2013, GSP is expected to grow at an annualized real rate of 3.0 percent.

All 15 of the state’s economic sectors are forecast to experience output increases during 2013. The sectors with the strongest expected growth are:

  • Mining, with a projected real increase of 8.5 percent;
  • Educational and Health Services, with a projected real increase of 5.4 percent;
  • Business and Professional Services, with a projected real increase of 4.9 percent;
  • Agriculture, with a projected real increase of 3.5 percent;
  • Transportation, Warehousing and Utilities (TWU), with a projected real increase of 3.3 percent;
  • Information, with a projected real increase of 2.5 percent;
  • Wholesale Trade, with a projected real increase of 2.2 percent; and
  • Construction with a projected real increase of 2.2 percent. 
2013 Employment Outlook

Seasonally adjusted nonagricultural employment in North Carolina is expected to reach 4,085,400 persons in December 2013, an increase of 1.3 percent over the employment level in December 2012.  The state is expected to gain 53,100 net jobs during the year. Eleven of the state's 14 nonagricultural sectors of the economy are expected to experience employment increases during 2013.  The sectors with the strongest employment increases in 2013 are Information at 4.2 percent, Hospitality and Leisure Services at 3.7 percent, and TWU at 3.5 percent.

The North Carolina seasonally adjusted unemployment rate began 2013 at 9.5 percent, almost two percentage points higher than the United States rate.  By July the North Carolina rate had fallen to 8.9 percent, while the United States rate had fallen to 7.4 percent. Both the U.S. and North Carolina unemployment rates are expected to decline throughout 2013, and by December the North Carolina unemployment rate is expected to be around 9.0 percent.

2014 Economic Forecast

Connaughton forecasts the state economy to increase by an inflation-adjusted rate of 3.3 percent during 2014.  For 2014, first quarter GSP is expected to increase at an annualized real rate of 3.6 percent.  During the second quarter, GSP is expected to increase at an annualized real rate of 3.2 percent. In the third quarter, GSP is expected to record an annualized real growth rate of 3.3 percent. In the fourth quarter of 2014, GSP is expected to also grow at an annualized real rate of 3.3 percent.

All 15 of the state’s economic sectors are forecast to experience output increases during 2014. The sectors with the strongest expected growth are:

  • Agriculture, with a projected real increase of 16.5 percent,
  • Educational and Health Services, with a projected real increase of 8.9 percent,
  • Business and Professional Services, with a projected real increase of 5.3 percent,
  • Construction, with a projected real increase of 4.8 percent, and
  • Other Services with a projected real increase of 4.2 percent.
2014 Employment Forecast

Seasonally adjusted nonagricultural employment in North Carolina is expected to reach 4,171,400 persons in December 2014, an increase of 2.1 percent over the employment level in December 2013.  The state is expected to gain 86,000 net jobs during the year. Twelve of the state's 14 nonagricultural sectors of the economy are expected to experience employment increases during 2014.  The sectors with the strongest employment increases in 2014 are Construction at 4.6 percent, Durable Goods Manufacturing at 4.3 percent, and Nondurable Goods Manufacturing at 4.2 percent.

Connaughton said that several recent and developing factors suggest that 2014 could represent a breakout year for the North Carolina economy:

  • In 2013 the U.S. avoided going over the ‘fiscal cliff.’ “While we did not avoid a tax increase, the impact was much less than the worst case scenario,” Connaughton said.
  • Consumers are returning to the economy. The August 2013 consumer confidence index rose to 81.5, the highest in almost six years.
  • For the first time in five years, we are seeing sustained increases in housing prices.  The Case-Shiller Home Price Index increased by 12.1 percent from June 2012 to June 2013, for the 20 City Composite.
  • Because of the improvement in the economy during 2013, the projected budget deficit for the 2013 fiscal year is down to $759 billion, or 4.6 percent of GDP. This compares to the 2012 fiscal year budget deficit of $1.1 trillion, which was the fourth consecutive year of budget deficits in excess of one trillion dollars.
“All of these factors will contribute to a 2014 growth rate that, for the first time in 5 years, will feel like a recovery,” Connaughton said. The full Forecast report is available at http://www.belkcollege.uncc.edu/forecast. Connaughton will release his next Forecast report in December 2013.

Like what you're reading? Subscribe to Cabarrus Magazine's free newsletter to catch every headline

In Print Babson Capital Management Belk College Economic Forecast Economic Growth John Connaughton NC Economy NC Employment UNC Charlotte
  • A VET TOGETHER

    10/17/2017
    09:00AM — 11:00AM

    • Join Cabarrus Veterans Coalition the first Tuesday of each month at Carm’s for free coffee and ...


  • SC 25 Fastest Growing Companies

    10/17/2017
    11:30AM — 02:00PM

    South Carolina's Fastest Growing Companies competition is the Annual ranking of the Palmetto Stat...


  • SC 25 Fastest Growing Companies

    10/17/2017
    11:30AM — 02:00PM

    South Carolina's Fastest Growing Companies competition is the Annual ranking of the Palmetto Stat...


  • Thriller Dance Lessons

    10/17/2017
    06:00PM — 07:00PM

    Ever wanted to learn the King of Pop’s famous Thriller dance? Now’s your chance! Head over to the...


  • COOKSMART/EATSMART COOKING SCHOOL

    10/17/2017
    06:00PM — 08:30PM

    Thursday evenings, October 12,19,26 and November 2 * 6-8:30 p.m. * $50 NC Cooperative Extensi...


  • TODDLER STORY TIME

    10/19/2017
    10:30AM

    • Children from walking age to three years old with caregiver. Songs, stories, finger plays follo...


  • View Trailer, More Info & Register on our Event Page. This 43-minute film goes behind the fi...


  • COOKSMART/EATSMART COOKING SCHOOL

    10/19/2017
    06:00PM — 08:30PM

    Thursday evenings, October 12,19,26 and November 2 * 6-8:30 p.m. * $50 NC Cooperative Extensi...


  • Music on Means

    10/19/2017
    06:00PM — 09:00PM

    To hear it, you might think you just stepped into Motown. To breathe it, you smell a tropical bre...


  • Cook Smart/Eat Smart

    10/19/2017
    06:00PM — 08:30PM

    This popular hands-on cooking class teaches more than 24 cooking techniques to make meal planning...


  • Brush Lettering 101

    10/19/2017
    06:30PM — 08:30PM

    Join Leah Benfield, with Little Dot Artworks, and Hive for a Brush Lettering Workshop. We will go...


  • View Trailer, More Info & Register on our Event Page. This 43-minute film goes behind the fi...


  • Music on Means

    10/19/2017
    06:00PM — 09:00PM

    To hear it, you might think you just stepped into Motown. To breathe it, you smell a tropical bre...


  • Brush Lettering 101

    10/19/2017
    06:30PM — 08:30PM

    Join Leah Benfield, with Little Dot Artworks, and Hive for a Brush Lettering Workshop. We will go...


  • 5th Bi-Annual Harrisburg ARTwalk!

    10/21/2017
    11:00AM — 07:00PM

    New Artists - Food & Entertainment! This year The 5th Annual Harrisburg ARTWalk continues it's gr...


  • Fall Festival & Movie in the Park

    10/21/2017
    03:00PM — 09:00PM

    Fall Festival begins at 3 p.m. Movie (Monsters Inc.) begins at 6:30 p.m. Come dressed in your...


  • 10th Rotary Annual Seafood Festival

    10/21/2017
    05:00PM — 08:00PM

    Cabarrus Rotary Charitable Works presents the 10th Rotary Annual Seafood Festival to raise funds ...


  • Movie Night Double Feature

    10/21/2017
    07:00PM — 09:00PM

    Join us for movie night on the farm featuring “Curious George: A Halloween Boofest” and “Curious ...


  • Just say "no" to electronics and hand held devices and step back in time to see the marvels of ea...


  • Thriller Dance Lessons

    10/24/2017
    06:00PM — 07:00PM

    Ever wanted to learn the King of Pop’s famous Thriller dance? Now’s your chance! Head over to the...


  • Trick or Treat in the Park

    10/27/2017
    05:30PM — 09:00PM

    Games * Candy * Food * Inflatables * Costume Contests * and More! Hundreds of costumed trick o...


  • Thriller Masquerade Ball

    10/27/2017
    08:00PM — 11:00PM

    This event celebrates the fun tradition of the carnival season. Attendees are invited to dress up...


  • Pumpkins in the Patch & Candy in the Corn

    10/28/2017
    10:00AM — 06:00PM

    Come out dressed in your Halloween costumes or attire. Trick or treat around the farm. This event...


  • Already the Carolinas' largest costume party, the Carolina Renaissance Festival becomes the place...


  • Come out to our third annual Kaleidoscope Cultural Arts Festival and Candy Crawl! We will have ar...


  • Halloween Fun Fest

    10/28/2017
    03:00PM — 06:00PM

    Our annual Halloween Fun Fest in Downtown Salisbury will bring ghoulish fun to residents and visi...


  • Gold Hill Ghost Tour

    10/28/2017
    05:00PM — 08:00PM

    Enjoy a fun night of ghost stories at one of the most haunted sites in Rowan County. Ghost storie...


  • Pumpkins in the Patch & Candy in the Corn

    10/29/2017
    10:00AM — 06:00PM

    Come out dressed in your Halloween costumes or attire. Trick or treat around the farm. This event...


  • Already the Carolinas' largest costume party, the Carolina Renaissance Festival becomes the place...


  • Candy Crawl

    10/31/2017
    03:00PM — 05:00PM

    Local merchants provide trick-or-treating and family-friendly entertainment on Union Street in Do...


  • Sweet Street at the Park

    10/31/2017
    05:00PM — 08:00PM

    Sweet Street is a family-friendly trunk or treat festival. There will be food, games, activities,...


  • Fall Plant Sale

    11/02/2017
    09:00AM — 05:00PM

    Garden now for spring blooms! Plants will be available for pick up between 9am and 5pm on Nove...


  • Cook Smart/Eat Smart

    11/02/2017
    06:00PM — 08:30PM

    This popular hands-on cooking class teaches more than 24 cooking techniques to make meal planning...


  • World of Outlaws World Finals

    11/03/2017
    06:00PM — 11:00PM

    The most prestigious dirt racing event in the country, the Nov. 2-4 World of Outlaws World Finals...


  • Battle for the Bell

    11/03/2017
    07:30PM

    Come watch the battle starting at 7:30. There will be tailgating beforehand, so be sure to stop b...


  • Hops & Heat Beer and Chili Festival

    11/04/2017
    01:00PM — 05:00PM

    Join us for an afternoon of Beer, Bands, and Buckets of Chili in Downtown Concord! Live music ...


  • Hops & Heat Beer and Chili Festival

    11/04/2017
    01:00PM — 05:00PM

    Make the best chili in town? Prove it! Join us Saturday November 4th from 1 - 5:00 p.m. in Downto...


  • Fall Back 5K

    11/05/2017
    01:50AM

    The inaugural Fall Back 5K is a new and exciting run event in the City of Kannapolis which starts...


Get Cabarrus Magazine Delivered to Your Door!

Subscribe today!

Proudly Brought To You By These Community Sponsors