Charlotte's Jobless rate rises to 12%
As the recession hit and companies around the region crumpled, Prodigy Diabetes Care did something unusual: It grew.
The Charlotte firm, which develops diabetes-management devices, surged to more than 200 employees from a handful a few years ago, and it plans to add 200 more next year, said co-owner Rick Admani Abulhaj.
The health care sector has been among the bright spots in the local labor market amid the financial crisis and spiraling economy. A few other fields, including government, have maintained or added jobs over the past year. Others suffered big hits, including finance and construction, driving unemployment to record highs that haven't eased.
New government data Tuesday showed that Charlotte-area unemployment climbed to 12 percent in October, up from 11.8 percent the month before. The news came after a few months of small declines and the accompanying chatter that the recovery was under way.
"It doesn't surprise me, but I don't think it's alarming, either," said Rick Kaglic, regional economist with the Federal Reserve in Charlotte. "Despite the recent uptick, I think the worst of the increases are behind us."
There are some positive signs: Layoffs have slowed, and temporary employment has climbed for the past three months, an indication that full-time hiring will begin to loosen soon, he said.
Still, the unemployment rate is jarring compared with rates a decade ago, below 3 percent, Kaglic said.
Also significant, he said, is that the Charlotte area's jobless rate is higher than the state average, 11 percent. That's partly because the region grew faster than other areas in recent years - and partly because of its ties to the manufacturing, finance and construction fields, which took major hits over the last year.
Those sectors contributed largely to the nearly 54,000 jobs the Charlotte region has lost since October 2008, according to the N.C. Employment Security Commission data.
Financial activities jobs dropped 7 percent over the year, for instance, and manufacturing employment fell 11 percent. The region's biggest loser has been natural resources, mining and construction, which lost 12,300 jobs - 23 percent - since last year.
Kaglic said manufacturing output is picking up. Despite lingering uncertainties in the finance sector, the field hasn't been as devastated as many anticipated. But construction still faces considerable challenges, as home prices fall and commercial vacancies rise, he said.
"How well Charlotte's economy recovers is largely going to hinge on how well those three sectors recover," Kaglic said.
At Barger Construction Co. in Mooresville, work slowed with the economy earlier this year but has begun turning around in recent months, President Gerald Brown said.
The company, which builds industrial plants, schools, hospitals and other buildings, isn't hiring, but it has held onto its 15 employees this year as other firms slashed their staffs. Brown said his company, founded 90 years ago as the Great Depression hit, is facing the strangest market in decades - but he remains hopeful.
"We're optimistic," he said. "When you're in construction, you have to be optimistic."
Meanwhile, state officials and workers are counting on the sectors that have fared better to carry the Charlotte region through its recovery.
N.C. officials have said they're focusing recruiting efforts - and dollars - on high-tech, high-paying jobs in biotechnology, aerospace and energy. Kaglic said health care has thrived through the recession and will remain important to the Charlotte region's future.
Education and health services was the only private field to add jobs over the last year, growing slightly by 800, about 1 percent.
"Health care is more of a 'need' than a 'want' product," Abulhaj of Prodigy, the diabetes device producer, said of his company's success. "Everyone is sick, and everyone is going to the doctor."
Prodigy attributes part of its success to developing an innovative blood glucose monitor - and offering it at a lower price than other companies, he said.
The company recently won a contract making it the only Medicaid-covered diabetes supplies provider in the state, and already, other states are calling, Abulhaj said. Prodigy plans to add 200 jobs next year when it moves operations from Asia to Charlotte. Its new plant is scheduled to open in January, he said.
"People are looking for a better, cheaper way to manage the disease," he said. "We're going to have to continue to grow. We can't just stop."
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Sources: McClatchy Newspapers, Charlotte Observer, Google Maps
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