North Carolina Doesn’t Miss a Beat
With the dearth of good news coming out of Washington these days, including the steepest year-over-year increase in inflation since February 1982 (7.5%), we thought we’d take a moment to cheer everyone up after Valentine’s Day and share some of the love coming out of Raleigh.
Fiscally conservative policies enacted over the last decade by the General Assembly, including the lowering of individual and corporate income taxes, slashing costly and strangling red tape, reducing debt, and enacting prudent budgets, continue to get results.
Perhaps the biggest news hit last Friday, when the Office of State Budget and Management reported a huge surge in state revenue. Gary Robertson of the Associated Press reports:
“North Carolina government tax collections have soared above expectations so far this fiscal year, as the state’s pandemic-rebounding economy has pumped consumer spending and edged the jobless rate close to pre-COVID-19 levels.
Through Jan. 31, state revenues are already almost $1.4 billion ahead of the total anticipated by the executive and legislative branches, the state budget office said Friday.
The revenue surge in state government’s first seven months of the fiscal year is happening in every major tax category, according to a summary provided by the Office of State Budget and Management. Corporate and franchise taxes, along with taxes related to alcoholic beverage and real estate transactions, are among those seeing the highest percentage growth.
The office said Friday that it now estimates over-collections will reach $2.4 billion by June 30, the end of the fiscal year…”
According to the Office of the State Controller, which publishes its Monthly Financial Report, the largest driver of the increase in revenue was from more than $1.2 billion in additional sales and use taxes, which are taxes on the sale of goods and services.
We saw a similar surge in total state revenue during the first five months of Fiscal Year 2021, with an increase of more than $1.5 billion over the prior year. North Carolina’s fiscal year runs from July 1 through June 30.
Unemployment continues its steady decline in the Old North State. The last time we checked in, the unemployment rate in North Carolina had been beating the national average for an entire year, at 4.2% compared to 4.8% nationally.
The North Carolina Department of Commerce reports that the state’s seasonally adjusted unemployment dropped to 3.7% in December, compared to 3.9% in November and 3.9% nationally. Unemployment in North Carolina was 6.1% a year earlier; for December 2021, we had 4.9 million people employed (an increase of 13,301) and just 160,692 unemployed (a decrease of 9,893).
A survey of North Carolina’s businesses by the Commerce Department reports that a majority indicated “optimism for the future of their businesses and reported they were meeting or exceeding revenue goals.”
And to top it all off, North Carolina has attracted more new jobs and more investment (more than $10 billion) in 2021 than in any other year on record. Some of the bigger fish:
Apple Computer plans to build a $1 billion campus in the Triangle, bringing with it more than 3,000 jobs;
Fujifilm will build a $2 billion biotechnology plant in Holly Springs which will produce vaccines and other drugs;
Toyota is building a $1.3 billion plant to manufacture batteries for electric and hybrid vehicles;
Boom Supersonic announced that they will build a manufacturing and assembly facility in Greensboro, employing 1,700 people to build supersonic airliners for commercial service.
“North Carolina continues to be recognized as a top state for businesses, and companies are investing billions to do business here,” commented Speaker of the North Carolina House Tim Moore. “We’re excited to see even more new jobs and investment come to North Carolina thanks to the thriving economic environment in our state.”