After several years of hearing that the Wilmington area’s economic growth was lagging behind the rest of the nation, the University of North Carolina Wilmington’s new regional economist had some good news for a change: Growth, while still modest, is projected to outpace the national average over the next couple of years.
It’s about time.
The recession dealt a heavy blow to southeastern North Carolina, particularly in the housing and construction markets that flourished in the early to mid 2000s. As seen if we look around, construction activity is buzzing again.
In addition, regional economist Adam Jones of UNCW said the job market has finally recovered to the level it was before the recession hit in 2008 and lingered on for several more years after it officially ended in 2009.
Jones has big shoes to fill. He replaces Woody Hall, whose annual prognosis provided information on the Wilmington metropolitan area that was not available in such detail from state or national assessments.
But with Hall’s retirement came a retooling of the annual UNCW Outlook Conference, with a concerted effort to get more local businesses and industries to attend and participate, and it was successful. The Burney Center’s large conference room was packed.
Economic activity has slowed in recent months, Jones said, but he still is hopeful about the coming two years. He downplays talk among some economists that a recession may be on the way.
“I am forecasting that there will be a recession sometime in the future,” Jones said with a grin. “But not next year.”
He predicts regional growth of around 3 percent next year, compared with national projection of 2 to 2.5 percent. The growth has been apparent in many ways. Tourism spending hit an all-time high in 2014-15, and many other sectors of the economy are hiring locally.
What wasn’t specifically addressed at the annual economic conference Tuesday — although it was mentioned in a Bank of America/Merrill Lynch newsletter left at each table — was the issue of wage suppression. It could take several more years for wages nationally to get closer to pre-recession levels, the company’s analysts predict.
However, Jones hit on it indirectly when he noted that manufacturing jobs have declined in the region over the past 20 years, but the leisure and hospitality industry has grown considerably. That industry typically pays low wages compared with manufacturing.
A consumer economy is dependent upon consumers having disposable income. Middle-class and high-wage jobs provide financial stability, allowing families to save and spend money on purchases that in turn create demand for more products.
The question Wilmington has been wrangling with for years is how to nurture those lower-wage jobs that provide entry into the job market, but also attract higher-wage employers to invest in the city and its labor force. And all that while still preserving the quality of life and environment that makes this place special.
One part of the answer came up during a panel discussion featuring top executives of two of Wilmington’s largest private employers — PPD and GE Hitachi Nuclear Energy — and UNCW Chancellor Jose Sartarelli.
PPD Chief Executive Officer David Simmons and Jay Wileman, CEO-elect of GE Hitachi, said companies look not only for the skills to do the job, but also to hire people who have what Wileman referred to as “deep smarts,” such as critical thinking, ability to synthesize information and use it, and interpersonal skills necessary to collaborate with others.
In introducing that topic, Sartarelli signaled “a shout-out to liberal arts.”
“I have met so many successful people who were history majors,” he said. “What you find is a lot of stuff we teach in history and psychology are extremely useful in business.”
His comments contrast sharply with those of North Carolina politicians — including Gov. Pat McCrory — who minimize the value of general knowledge and a broad education.
“I worked for three companies in my career,” said the chancellor, whose came to academia from the business world. “A lot of our students are likely to work for three, four five companies. … They are going to have to reinvent themselves.
“Whatever you get in college, the most important thing is thinking — critical thinking. Everything you need to know is right here,” Sartarelli said, holding up his smartphone. “But you can’t get wisdom or insight without critical thinking.”
It’s good for business, and it’s good for the regional economy. Think about it.
