Comparing local economies

Host Mary Walden says that people often compare local economies, like Charlotte and Raleigh or Wilmington and Asheville. Often, these comparisons show big differences.  Her husband, N.C. State economist Mike Walden explains why.

Mike Walden: “We really shouldn’t be surprised Mary, because just like people, local economies tend to naturally differ. That is, people will specialize in doing certain kinds of jobs. You are a teacher; I’m a teacher. My father was a carpenter; your mother was a sales person. So, we tend to not be ‘jacks of all trades,’ if you will, which our predecessors hundreds of years ago were.

“But we tend to specialize. You can say the same thing really happens to local economies. So you have for example, Charlotte which has a specialty in finance.  Raleigh is, of course, associated with technology. Down East is associated with farming; Fayetteville with the military.

“Local economies tend to specialize and focus in one or a couple of areas. Now what this does mean, therefore, is if that particular segment of the economy that the local economy is specializing in takes a turn for the better, or takes a turn for the worse, that’s going to have a profound impact on that local economy.

“And of course, one big issue that we’ve seen over the last few decades in North Carolina is if you look at small town North Carolina, which traditionally tended to specialize in manufacturing, textile manufacturing, furniture manufacturing, to tobacco manufacturing of course all of those segments have declined. And that’s had a major impact on small town North Carolina that they’re still trying to recover from.”

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