States economic outlook is bright, say officials
By Sam Atkins
Published in News on January 4, 2005 2:03 PM
RALEIGH -- The outlook for North Carolina's economy in 2005 is bright, except for the 10,000 to 15,000 textile jobs that are expected to be lost. That was the message Monday at a state economic forum.
The job loss in the textile industry is predicted because of the end of trade quotas that had increased prices on imports. The lower-cost imports are expected to drive more North Carolina mills out of business.
Dr. Harry M. Davis, a finance professor at Appalachian State University, said the economy will grow about 3 percent this year, and the state will add 60,000 jobs.
The job creation is less than in 2004 when the state added 80,000 to 90,000 non-farm jobs.
Davis joined several other speakers as part of the third annual N.C. Economic Forecast Forum sponsored by the N.C. Citizens for Business and Industry and the N.C. Bankers Association. Around 700 people gathered at the Sheraton Imperial in Research Triangle Park.
The strongest sectors of the economy are construction, financial services, educational and health services, professional and business services, and tourism.
North Carolina is the ninth-fastest growing state in population and the sixth most-visited state, said Davis.
Meanwhile, the furniture industry is stabilized, and the state should fare better during the next recession because the jobs that are left are higher-paying ones, he said.
The unemployment rate will remain around 5 percent. The rate has dropped, and now only 21 states in the United States have a lower rate than North Carolina. The state rate dipped below the national average in March and has remained lower for the last nine months, he added.
Davis said community colleges will have to train many people because the jobs in the strongest sectors will require higher skills than the manufacturing jobs that were lost.
"We are well positioned for fairly healthy economic conditions next year," said Jeffrey M. Lacker, president of the Federal Reserve Bank of Richmond, Va.
Companies have been forced to hire people because of increased production, he said. Consumer spending and employment growth should continue at a strong pace in 2005, and inflation will remain low, added Lacker.
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