What will the future hold for North Carolina?

Broad: Population shift, workforce talent gap present challenges

• View Molly Broad’s PowerPoint presentation

By Jason King
Assistant Communications Director

In 1940, President Franklin Delano Roosevelt described the South as “the biggest problem faced by our country.”

Molly Broad, president of the 16-campus UNC system from 1997 – 2006, recently announced her impending departure from the faculty of the School of Government in order to become president of the American Council on Education in Washington, D.C. (Photo by Jason King)

That had all changed 50 years later, as half of all new jobs in the United States were being created in the South. North Carolina was a primary force behind that change, developing the nation’s most intense manufacturing economy.

The state is now in the midst of another profound change – one that holds “the potential to be a perfect storm,” according to Molly Corbett Broad, president emerita of the University of North Carolina system.

Broad addressed North Carolina’s challenges and opportunities before the NCACC Board of Directors during its Feb. 6 meeting in Raleigh. Her presentation, developed for the inaugural Local Elected Leaders Academy, revealed a North Carolina with higher unemployment, a lower standard of living, greater inequity in wealth and wages, and increasing social and political polarization.

Because of the impact technology is having on all parts of the state, intellectual capital will be North Carolina’s most important resource over the next 20 years, she said. Unfortunately for many rural parts of the state, that capital will likely remain in the crescent-shaped, technology laden region that runs from the Research Triangle, through the Piedmont Triad and into Charlotte. In 2006, those three economic development regions accounted for almost two-thirds of the state’s employees.

Average annual wages in those three regions were also higher than others, with workers in the Charlotte and Research Triangle regions earning a little more than $40,000 and Piedmont Triad employees taking in roughly $34,000. The Southeast, Eastern, Advantage West and Northeastern economic development regions all fell in the $25,000 – $30,000 range.

“We are seeing a growing disparity that some people would describe this way: the rich got richer and everyone else got poorer,” Broad said.

Not surprisingly, there’s a direct correlation between education and lifetime earnings. Data from the 2000 U.S. Census revealed a wide disparity between the lifetime earnings of workers with a professional degree ($4.4 million) and those who failed to graduate from high school ($1 million). Workers with bachelor’s degrees ($2.1 million) and master’s degrees ($2.5 million) were already well behind those with doctoral ($3.4 million) and professional degrees, and that disparity is only going to widen, according to Broad, as an advanced education will be required for future jobs.

By 2017, the state will be 15,000 workers short of filling the need of jobs that require four or more years of college, and 19,000 workers short of filling the need for jobs that require two years of college or technical training, according to projections.

Broad’s “perfect storm” comes together when looking at the level of education completed by Hispanics – the fastest growing segment of North Carolina’s population – and the percentage of the workforce that is either in retirement (65 and older) or in the late stages of its career (55-64).

North Carolina had the nation’s fastest-growing Hispanic population from 2000-05. Meanwhile, Hispanics account for the highest rate of public school dropouts and lowest rate of college enrollment of any population segment. In 2005, almost half of all Hispanics in the state age 18 and older had yet to earn their high school diploma.

“This has major implications,” Broad said. “Kids aren’t making it through college. They aren’t even making it through community college.”

Compounding that talent gap in the workforce is a graying population. The segment of citizens age 55 and older, accounting for 23 percent of the population in 2006, will grow to 40 percent by 2030 as baby boomers age out of the workforce.

These current trends certainly present challenges for all counties to overcome. But our current path leads to a North Carolina no one wanted to envision.

“Our children and grandchildren stand a greater chance of seeing a lower standard of living,” Broad warned.