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Understanding Economic Indicators: Hometown Legislative Action Day Highlights 2024 Outlook


Laura Dawson Ullrich, senior regional economist for the Federal Reserve Bank of Richmond's Charlotte Branch, 
delivered the keynote address at Hometown Legislative Action Day

Laura Dawson Ullrich remembers the exact date that her three school-age sons returned home from school to live in COVID-19-pandemic-enforced seclusion with online learning programs for the next year and a half: March 13, 2020. Jokingly, she noted that it was a Friday the 13th.

At the same time, Ullrich needed to be able to be able to work from home with limited interruption, a need that was challenged by the open floorplan of her house. The construction materials needed for renovations were in short supply, though, because the pandemic was creating supply disruptions, and many people all had the same idea to renovate their homes at the same time.

“What do you think the price was like for doors? Sky high,” she said. “And I paid for them happily, with money that we were supposed to use to go on vacation.” 

The pandemic created immediate and dramatic economic changes in production and spending habits, and Ullrich, the keynote speaker at February’s Hometown Legislative Action Day, explained what the consequences of those disruptions looked like several years on. 

Ullrich serves as the senior regional economist for the Federal Reserve Bank of Richmond’s Charlotte Branch. She discussed both the economic growth of recent years as well as potential economic outcomes in 2024, in part because of the need for city and town councils to understand economic trends and possibilities so they can plan municipal expenditures and target development projects. 

A key takeaway: economic growth in 2023 had been significantly stronger than many had predicted, with the potential for growth in 2024 appearing promising. While uncertainties always exist, Ullrich said, fears of an impending recession, long discussed by many commentators, had lessened. Inflation, while remaining above the 2% targeted by the Federal Reserve, has been falling. 

Inflation, she said, is “moving in the right direction faster than we might have expected given the strength of consumption, consumer spending and hiring.”

These changes came a few years after the pandemic created an extreme economic shock. In 2020, the full-year decline in the United States’ gross domestic product added up to 3.5%, the greatest decline seen in the post-World War II era.

“The COVID period was just unreal,” Ullrich said. 

She noted the numerous instances of stimulus funding aimed at helping reduce the effects of the economic shock, from stimulus checks to Paycheck Protection Program loans to the Inflation Reduction Act and the Infrastructure Investment and Jobs Act, among others.

“Really, there were many institutions that had once-in-a-lifetime funding flow through them,” she said. 

Nationally, employment has exceeded pre-pandemic levels, with recent months producing very strong reports. The U.S. Bureau of Labor Statistics reported that the nation gained 353,000 jobs in January 2024, beating the monthly 2023 average of 255,000.  

Employment figures in all of the metropolitan statistical areas in South Carolina are now above pre-pandemic levels, especially in the Myrtle Beach and Charleston MSAs. The Charleston MSA is the dramatic standout, with employment growing by 12.7% from February 2020 to December 2023. 

Part of this, she said, comes from the Carolinas being places where people want to live, given their climate and the availability of beaches and mountains. She noted, however, that both economic growth and population growth are far from uniform in the area.

“There are some metro areas like Charlotte, Raleigh or Charleston, that are far outperforming [other] urban areas, and especially rural areas, in terms of economic and population growth, she said. “It is very important for me as an economist to acknowledge that while places like Charleston and Raleigh are on fire in terms of growth, half of the counties in South Carolina and North Carolina are experiencing population and employment declines.” 

Another serious challenge comes in the form of labor force participation, which nationally has now been in decline since around 2000, and which the BLS projects to further decline to 60.4% by 2032. It has not yet fully recovered from the sharp pandemic-related drop. In South Carolina, this trend comes with the added dimension of the state increasingly serving as a retirement destination. For example, the Hilton Head Island-Bluffton MSA’s population growth comes in significant part from people who have arrived specifically to not work, but who require services, which contributes to the labor shortage. 

Labor participation in South Carolina, Ullrich said, “is going to be an issue for the next few decades. This impacts all sorts of things for employers.” 

“It is a super dynamic, interesting time,” she said. “The Carolinas, as a whole, in my opinion will absolutely be winners. South Carolina will absolutely be a winner. There are going to be communities in South Carolina that continue to lose people and talent. As a state, as an institution, you guys are going to have to think about how to support those communities, because there will be people that have very deep ties to those communities that want to remain in place.” 

Find presentation materials for the 2024 Hometown Legislative Action Day online.