Questionable Criteria On NC Worker Ranking Begs A Deeper Dive

By Donna King
Carolina Journal

North Carolina’s economic health seems strong. Taxes are low, cost of living is below average, and a recent CNBC study gave the state a No. 2 ranking as “Best for Business” because of solid growth, quality workforce, business friendliness, and technology.  

It’s all meant that more individual workers are making this state home every year, with average full-time wages at $54,000 annually in 2021. But a recent study from Oxfam, a Boston advocacy group that lobbies for government interventionist policies, rated N.C. dead last for workers. 

Why the disparity? The two studies paint different pictures of our great state because they look at different data from a different point of view. Reading between the lines is revealing. 

The Oxfam study got more local media coverage by labeling N.C. as one of the “Worst States for Work” in the United States. Oxfam cites the reason as the lack of intervention policies by the state government, such as the fact that N.C. minimum wage aligns with federal law, and its Right-to-Work status means it isn’t fertile for unionizing. The authors did not calculate in the large number of people moving to North Carolina for work, a cost of living at least 6% lower than they national average, or the overall wage growth. 

“This index is specifically just looking at state level policies for workers,” said Kaitlyn Henderson, Ph.D. and lead researcher for Oxfam, in an interview with Carolina Journal. “We really wanted to celebrate those states that are seeking to support even the worker who earns the least amount of money.” 

The Oxfam study gave three criteria for judging a good environment for workers: The presence of a minimum wage law compared to the cost of living, power of labor unions and collective bargaining, and regulatory laws mandating some benefits, such as requiring that all businesses give paid sick and vacation days. 

Oxfam held up New York and California as among the best places for workers because they have a $14 and $13.50 an-hour minimum wage, respectively, and state policies encourage unions. However, the two have some of the highest unemployment rates in the country and notoriously high cost of living. According to Forbes, New York’s job growth is stagnant and 60% of the moves recorded were people moving out, not in. For California, it’s a similar story. From 2000 to 2020, California had a net loss of 2.6 million people to other U.S. states, and lost a congressional seat in the most recent census. More than 265 companies have moved their headquarter out of California since 2019, at an average of six HQ losses per month. Still, prices are 16% higher than in most other states. Those factors are driving people out of the state in record numbers. 

Oxfam said they did not calculate in worker satisfaction, either. 

“This index is supposed to just be a capture of the policies that do and don’t exist,” said Henderson. “It’s kinds of a resource for people at the state level and at the federal level to say where do these policies exist and where do they not.” 

“This is more of a left-wing progressive ideological wish list of interventionist policies rather than which states are actually creating jobs, creating opportunities and creating income growth for workers,” said John Locke Foundation’s Brian Balfour. “What they favor are things that make it more expensive to hire workers, which means that fewer workers are hired.”   

The Oxfam study also gave ratings based solely on minimum wage workers, which is about 5% of N.C.’s full-time workforce. 

“If you are going to create a ranking of states that are best states to work, I would think you’d include states are actually putting people to work,” said Balfour. “States have higher rates of employment and job growth and higher wage growth — more jobs and higher wages, that sounds pretty good for workers to me.”