Economists who study the Souths dynamics are taking different bites from what they see as a sweet bar graph pattern detailing South Carolinas unemployment trends.
There was little not to like about this past weeks October report showing South Carolinas jobless numbers falling to their lowest level in more than five years and running closer to the national average than they have in 11 years.
The state Department of Employment and Workforce, in a report showing an unemployment rate that at 7.5 percent was just 0.2 percent higher than the U.S. rate, said South Carolinas employers were largely responsible for the improvement by hiring a net 17,779 workers in the past year. That, and the 9,200 leaving the labor force since October 2012, lopped 1.3 percent from the jobless rate.
To Clemson University economist Bruce Yandle, the decline that has brought the state so close to the national average shows an economy that has finally transformed from the one dominated for a century by textile mills.
Convergence suggests South Carolinas structural transition is over. The friction associated with the transition from heavy concentration in textiles and apparel to durable goods manufacturing and services is about gone, he told The Greenville News. It was a transition about 20 years in the making, roughly dating to the North American Free Trade Agreement of 1994 that began a run to cheaper labor, taking away the jobs of hundreds of thousands of textile workers in the Carolinas and Georgia.
While unemployment rates for North Carolina and Georgia have also dropped to 8 percent and 8.1 percent in October, respectively South Carolinas neighbors havent covered as much ground lost in the Great Recession.
Mark Vitner, senior economist with Wells Fargo Securities in Charlotte, said South Carolina has been exceptionally successful at recruiting new industry over the past few years and many of these facilities are now in the process of staffing up or expanding from their initial footprint.
He can point to BMW and Michelin as the bell cows who can start a trend with massive expansion projects in tough times and corresponding expansions by suppliers that ultimately add big numbers to the Upstates payrolls, and also to the smaller industrial companies whose hiring announcements of dozens of workers add up.
Yandle said what the industrial recovery means is that South Carolinas economy has been the second strongest in the region for several quarters. Tennessee was the strongest. Georgia and Florida are now accelerating, but the Palmetto State has the advantage of having been stronger longer and for having a more significant auto/tire export economy.
Michael Dolega, an economist for TD Bank, said what is encouraging about South Carolinas report is the improvement in the unemployment rate was largely driven by employment gains and less so by declines in the labor force. The labor force fell slightly in South Carolina but the state gained 8,400 jobs in the two months through October, according to the household survey.
What Dolega found not to like was who is doing the hiring.
What is somewhat discouraging about the report is that of the 11,500 in new payrolls in South Carolina, only 7,300 were in the private sector. Government and state government in particular added the rest, he said.
Dolega added that he would like to see more private-sector momentum to feel more confident about the economic outlook. Still, both manufacturing and construction held their own, adding 3,400 and 2,500 during the two-month period, respectively. Durables led the way once again, with the future of industry in the state looking bright.