New jobs, income growth in Raleigh will outpace nation

Published August 29, 2013

By Amanda Jones Hoyle, Triangle Business Journal, August 16, 2013.

Employment and income growth in the Raleigh market will outpace the nation for the rest of 2013 and into 2014, but all the new workers migrating into the region will keep the unemployment rate elevated over the next couple of years.

That’s according to a new Raleigh market outlook report from the economists at PNC Financial Services Group (NYSE: PNC).

PNC’s economists forecast that payrolls in the combined Raleigh market, which also includes demographics from Durham, Goldsboro and Rocky Mount, will expand “slightly slower” than other major markets in the South such as Charlotte and Atlanta, but the jobless rate will continue to decline to 7.1 percent in the fourth quarter from 7.4 percent in the first quarter.

Unemployment in the Raleigh market in 2014 is forecast to drop to 6.9 percent buoyed by an increase in the creation of new jobs.

PNC raised its forecast for employment growth to 2.2 percent in 2013 and to 2.5 percent employment growth in 2014, which is very near the market’s peak in early 2008. By comparison, the U.S. employment growth rate is still 1.5 percent lower than the 2008 peak, according to the report.

• On housing, expect to see a 6.3 percent drop in building activity in 2013 compared to the year prior, and a 3.9 percent decline in single family building permits in 2014.

Housing prices are rising more modestly than the national average, but the total price correction in the region was also much smaller. Home prices fell only about 7 percent in the region during the recession compared to a 34 percent decline nationally, the report states.

Housing prices in the Raleigh market are forecast to increase 1.8 percent in 2013 and 2.8 percent in 2014. Nationally, prices are forecast to increase 9.5 percent in 2013 and 3.6 percent in 2014.

• On personal income, the Raleigh market median income is forecast to increase a modest 2.3 percent in 2013 but will make up for it in 2014 with a projected 4.9 percent increase in personal income. Nationally, personal income of expected to grow 2.7 percent in 2013 and 4 percent in 2014.