Regional Report Triad May 2010
It’s no secret that the Greensboro-High Point metro area — which covers Guilford, Randolph and Rockingham counties — has struggled, but just how bad has the job market been? From the end of 1999 through 2009, only one major metro area in the Southeast lost a higher percentage of its jobs — and that place was hit by a catastrophic hurricane that shrank its population 10% during the period.
A recent report by The Brookings Institution, a Washington, D.C., think tank, found a 5.6% decline in Greensboro-High Point’s job base, 11th worst among the nation’s 100 largest metros. In the 16-state Southeastern U.S., only New Orleans — where employment shrank 15.6%, due largely to Hurricane Katrina in 2005 — fared worse. (Greensboro-High Point’s neighbor, the Winston-Salem metro, isn’t among the nation’s 100 largest.) “Most of the cities that ranked low either bore the brunt of the housing bust or were involved in auto or auto-parts manufacturing,” says Howard Wial, a Brookings fellow and co-author of the study. “In Greensboro, the reasons were more idiosyncratic.”
The local economy’s reliance on traditional industries such as textiles, apparel and furniture manufacturing made it especially vulnerable to job losses as manufacturers sought lower costs abroad. The result was an 11.4% unemployment rate in the fourth quarter of last year — compared with 9.7% nationwide — and a 4.6% drop in gross metropolitan product from its peak in the fourth quarter of 2006. Only 12 of the 100 largest metros saw a bigger drop from their peak.
The long-term decline of manufacturing jobs in the U.S. has slowed recovery from recent recessions, says Andrew Brod, director of the Center for Business and Economic Research at UNC Greensboro. And because the latest recession was triggered by a global financial crisis, manufacturers weren’t able to rely on the export market to bring them back from the brink, as they’ve done in the past. The key to recovery, Brod says, will be Greensboro’s ability to attract other industries. “It needs to figure out what it will be in the new economy.”
The region has been courting businesses in aviation, life sciences, advanced manufacturing, nanotechnology, transportation and logistics, and business and financial services, says Dan Lynch, president of the Greensboro Economic Development Alliance. And it has had some success in each category. “We’re certainly not hanging our heads and wringing our hands, saying, ‘Woe is me.’”
But even with modest growth — gross metropolitan product grew 2% in the fourth quarter — it might take the Greensboro metro at least five years to recover all the jobs lost since the recession began in 2007, Wial says. “It will happen, but it could be a long time in coming.”
Greensboro-based RF Micro Devices Inc., best known as a maker of semi-conductors for cell phones, says it has developed a way to efficiently manufacture cells that convert sunlight into energy. Because they can be made with the same equipment and materials RF Micro uses for its bread-and-butter product, the photovoltaic cells are considered a natural leap. If successful, they would provide a hedge against fluctuations in the wireless market. Executives would not say how much was being spent nor how many jobs might be created. The company developed the cells in collaboration with the federal National Renewable Energy Laboratory and hopes to begin high-volume production in 2012.