The state’s employment rates are sinking, but Durham has bucked the trend.
According to the North Carolina Employment Security Commission, the state’s seasonally adjusted unemployment rate exceeded 10 percent for the first time since last October, a rate of 10.1 percent as of July. This is a full percentage point higher than the national average—9.1 percent—and reflects a two-fifths of a percentage point increase in state unemployment since May.
Durham County, however, has fared significantly better, as its unemployment rate decreased from 8.4 percent in June to the current 8.2 percent, according to the state ESC report.
“We have not felt the blow the state felt of climbing unemployment rates,” Durham Mayor Bill Bell said. “We have had maybe two or three positions discontinued [in the city government] and haven’t seen much growth in the housing and construction sectors, but all in all our unemployment rate went down.”
Bell said Durham’s advantageous position in the job market can be attributed to city and county policy as well as institutional steps taken to sustain the public school system and promote entrepreneurship.
“Our county commissioners have really stepped up to the plate as they usually do, and we have been very lucky because we—unlike many other districts—did not spend all the money we received from the [federal] government last year,” Durham Public Schools President Jeffrey Nash said. “That is why we have not seen the mass layoffs in education occurring elsewhere.”
In November 2010, Durham Public Schools received $6.2 million from the Federal Education Jobs Fund intended for salaries of personnel working at the school building level, said Paul Lesieur, DPS executive director of budget and management services.
“We did not spend any of the Education Jobs funds last school year,” Lesieur said. “[This school year] we are using it to pay for teachers, assistant principals, school office staff, treasurers, custodians and student accounting personnel all who are located in the school [system].”
He added that the school system maintained positions that have otherwise been eliminated by saving the Education Jobs funds and using them this year. Only 38 positions were cut from DPS at start of the school year.
Across North Carolina, however, the ESC stated that 12,100 government workers were laid off in July—11,800 of which were from local government. In the private sector, however, 6,900 jobs were added in July.
July was the first month of the state’s 2011-2012 budget of $19.7 billion, which required public schools to cut a total of $124 million. The plan included many mandated layoffs throughout state government and ordered local school districts to manage the budget cuts without affecting classroom teachers too heavily.
“The spending freezes implemented at DPS over the past two years were part of our strategy to avoid the cliff that faces all school districts in North Carolina in the next two years,” Lesieur said. “The county is also proposing a one-fourth cent sales tax increase that is intended to be used for DPS and Durham Technical Community College next year.”
He added that without this proposed sales tax increase, DPS would lose funding that would be targeted to replace the Education Jobs funding that supports approximately 129 jobs currently.
“We consider investing in our youth an extremely high priority,” Bell said. “We’re not willing to sacrifice that future because a proper education and job opportunities for today’s children are necessary for tomorrow’s economic growth.”
State teenage unemployment rates tell a different story. According to the Employment Policies Institute, a non-profit research organization, North Carolina has the third highest unemployment rate among teenagers—following Nevada and California—at 33.7 percent.
John White, director of public policy at the Greater Durham Chamber of Commerce, said he believes that young people can drive the economy by engaging in entrepreneurship. He added that businesses create 72 percent of Durham’s annual income and noted that many students—especially from universities such as Duke—create start-ups.
White said much of Durham’s ability to endure the financial downturn is due to its vibrant businesses and the encouragement Durham offers young people with entrepreneurial visions.
“Raleigh focuses more on larger companies and so many big businesses have headquarters there,” White said. “But Durham tries to create the right environment for start-ups and make it easy for young people to follow their creative ideas to fruition.”
Adam Klein, director of strategic initiatives for the Greater Durham Chamber of Commerce, said the city of Durham makes a concentrated effort to draw in young people to boost its economy. The city has organized and funded a program called the Bull City Stampede, which provides entrepreneurs the basic necessities for new start-ups including free furnished office space and the advice of experts. Klein added that by also providing many of the same appeals as New York City—while maintaining a much lower cost of living—Durham draws in the college graduate crowd.
“We provide the cultural amenities to put Durham on the map for new graduates,” Klein said. “From the Durham Bulls, to our nightlife and the unique food scene, Durham has been put together as an attractive place.”
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