Editor’s note: In the 12th report for 2021, N.C. State economist Dr. Mike Walden provides an analysis of the state’s economy entering 2022. It’s the 12th year for Walden’s NCSU Index of North Carolina Leading Economic Indicators.


RALEIGH – The Index for November dropped by a tiny, tiny amount, thereby essentially being unchanged. Among the components, the national index and manufacturing earnings improved while initial jobless claims and building permits dropped.

The result – the state economic outlook for growth remains the same.

But with so much uncertainty from the virus to Federal Reserve policy to congressional deliberations, it’s advisable to watch economic events and to be flexible.

Like 2020 and 2021, 2022 is likely to be a year for paying close attention to events.

Source: Dr. Mike Walden

Inside the numbers

The NCSU Index is a forecast of the state economy’s direction four to six months ahead, changed very little in November from its level in October, with the Index dropping from 98.3 to 98.2.

However, the changes were mixed among the individual components. The national index and manufacturing earnings were each up almost 2%, whereas initial jobless claims surged 24% and building permits dropped 12%.

However, the jump in jobless claims was due to a doubling of claims in the last week of November, likely due to the Omicron variant.

Consequently, considering that building permits tend to be volatile, the latest Index value is best interpreted as signaling neither an improvement nor a deterioration in the immediate state economic outlook. With so much uncertainty related to the virus, this can be viewed as a positive year-end outlook.

Source: Dr. Mike Walden

About the Index: The Index is composed of five components: the Economic Cycle Research Institute (ECRI)’s Weekly Leading Index (http://www.businesscycle.com/resources/), North Carolina initial claims for unemployment benefits, North Carolina building permits, average weekly hours of work of all North Carolina employees in manufacturing, and average weekly earnings of all North Carolina employees in manufacturing. All data are seasonally-adjusted and modified for differences in prices levels where appropriate. Data are from the U.S. Bureau of Labor Statistics, the U.S. Census Bureau, and ECRI, whose permission to use their Weekly Leading Index is greatly appreciated. All calculations are done by Dr. Michael Walden, and comments can be sent to michael_walden@ncsu.edu.