Analysis and Comment on South Carolina's Recent Unemployment Data, Expected to Stay Low in 2017

Richard Breen

Tuesday, December 20th, 2016

The South Carolina unemployment rate is at its lowest point in 16 years and not expected to rise significantly anytime soon, a trend that will shift priorities for state policy makers.

Unemployment dropped to 4.4 percent in November, down from 4.7 percent in October, according to the S.C. Department of Employment and Workforce. The agency said it was the seventh consecutive month in which the rate has gone down.

While economists debate specific percentages, most agree that as the unemployment rate falls below 5 percent, the labor market reaches the “full employment” stage.

“Full employment means most people looking for work are able to find a job,” said University of South Carolina research economist Dr. Joey Von Nessen recently during the school’s 36th Annual Economic Outlook Conference.

Indeed, 7,528 people in South Carolina found jobs in November, pushing the state’s employment level to an all-time record 2,200,101. The number of unemployed fell by less – 6,275 – which begs the question of where the other 1,253 workers came from.

South Carolina has been continuously growing its population, so some new workers could have come from out of state. Also, some people not officially looking for jobs – a group that doesn’t get counted in the unemployment figures – may have come off the sidelines and re-entered the workforce.

“We’re in a very tight labor market in which employers are struggling to find workers,” Von Nessen said.

Tight labor markets (USC economists expect the unemployment rate to be no higher than 4.5 percent by the end of 2017) lead to rising wages (those same economists expect total personal income to grow at 4.8 percent in 2017). Rising wages encourage those not looking for work to rejoin the labor force.

That is not expected to be enough, however, to keep South Carolina’s economy growing at the rate it has been. There has been much talk about a “skills gap,” which is the difference between what job applicants are able to do and what the current marketplace needs them to be able to do in order to be productive workers.

“This is especially true when it comes to soft skills,” Von Nessen said.

He said the state’s technical colleges have been helpful in working with industry to develop technical skills in the workforce. Soft skills, however, are “pretty much anything non-technical,” such as teamwork and leadership skills, as well as the simple ability to show up for work on time.

“The struggle is finding those soft skills,” Von Nessen said.

Federal Reserve banks in both Atlanta and Richmond have been studying the skills gap to determine its impact on the economy as a whole. In its October “Beige Book” report on local economic conditions, the Richmond Fed, whose district includes South Carolina, also reported a tightening labor market.

“A contact in South Carolina said that construction was being constrained by labor shortages,” it reported. “A construction industry source in Virginia reported a tremendous increase in training programs. Similarly, an executive in Maryland noted increased investment in employees, such as sending them to a local community college to improve or gain skills. ... A South Carolina contact attributed an increase in turnover in the trades to employees being lured to new jobs with higher wages.”

in addressing the recent unemployment numbers, DEW Executive Director Cheryl Stanton mentioned Federal Reserve reports and concluded, “to stay on pace with our robust growth … we must continue to develop our workforce for the 59,000 jobs that are currently available across the state, and those other jobs coming soon.”

With Gov. Nikki Haley potentially stepping down in January to become U.S. ambassador to the United Nations, current Lt. Gov. Henry McMaster will be inheriting a much different challenge than the high unemployment rates Haley encountered when she was sworn in during the Great Recession’s aftermath.

“Her priority was to generate job opportunities for South Carolinians,” Von Nessen said. “Workforce readiness becomes a very big issue for a new governor.”

Looking more closely at the November data from DEW:

  • Charleston County had the state’s lowest unemployment rate, at 3.2 percent.

  • Marion County had the state’s highest rate, at 7.5 percent.

  • Orangeburg County had the biggest month-to-month drop, falling from 9.4 percent in October to 7.2 percent in November.

  • Every county in the state saw its unemployment rate go down in November.

  • Metro area unemployment rates were 3.4 percent in Charleston, 3.6 percent in Greenville, 3.8 percent in Columbia and 4.5 percent in Florence.

  • The professional and business services sector was the biggest gainer in November, adding more than 3,600 jobs.

  • The statewide unemployment rate was 5.5 percent in November 2015.


Richard Breen is a senior editor at Got an idea? Contact him at

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