Raising a glass to growth.

• Author: Hood, John
• Position: Free & Clear

North Carolina's economic rebound tops most other Southeast states. Big surprise--our politicians don't agree on who deserves the credit.

When it comes to the economy, is the glass half empty or half full? As politicians prep for the 2016 election cycle, some version of this question will be posed many times --and about two different containers. Democrats will describe the glass containing the U.S. economy as half full and the one containing the North Carolina economy as half empty to support their case for retaining the White House and recapturing the Governor's mansion. Reverse the two, and you will have the Republican argument.

In historical terms, neither side will be correct. If you measure the strength of economic recoveries from the troughs of recessions, most recoveries in modern times have been far stronger than the current one. In fairness, relatively slow growth is not simply an American phenomenon. It is evident in much of the rest of the developed world. Still, because most Americans remember when "boom" times really felt like booms, they aren't buying any happy talk right now. For them, there's not much in the glass at all.

That's the national context. Now let's focus on North Carolina. For purposes of evaluating the state's economic momentum--or perhaps even to decide whether you might want to keep Republican Gov. Pat McCrory in office for another term or replace him with likely Democratic nominee Attorney General Roy Cooper --the relevant issue is not how much is in the glass at the moment. Instead, you want to know how quickly liquid is entering the container, and how that growth rate compares to what's happening elsewhere.

Even more basic, what liquid are we talking about? To evaluate economic performance, various measures can be considered, including gross domestic product, unemployment rate, job and wage growth and personal income gains. Each measure has its uses. I prefer to look at a variety of indicators while recognizing the drawbacks of each one. Often there is a trade-off between timeliness and analytical value. For example, the standard U-3 unemployment rate attracts tremendous attention because the Bureau of Labor Statistics produces it each month for every state. Because it comes from a monthly survey with a fairly small sample size, it isn't trustworthy on its own as a picture of what's truly going on in the labor market. It doesn't distinguish between people who leave the unemployment rolls because they find a...