The East, with the least, remains much the same.

• Position: ECONOMIC OUTLOOK - Interview

Eastern North Carolina has done little to improve its economy in the past five years, according to a report from the North Carolina Center for Public Policy Research, a Raleigh think tank. Just 12.9% of the region's work force is in manufacturing, which offers the highest-paying jobs, compared with 15.6% for the state. And both percentages are shrinking. Mike McLaughlin is editor of North Carolina Insight, the center's journal.

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BNC: Why does the East keep lagging?

McLaughlin: One big issue is the education level of the work force. As a region, these 41 counties, most of them east of Interstate 95, have higher dropout rates, lower percentages of college graduates and lower per capita income than the rest of the state.

What industries thrive in the East?

Agriculture still drives the economy. It really is the breadbasket of North Carolina. The military has survived this latest round of base closures. There is some concern, though, about a major mobilization. Will that cause an economic hiccup?

Your study says only 2% of the workers are in agriculture. How is it the driver?

That won't include anybody in the farmer's family who works on the farm and migrant workers. You also need to look at meat-processing plants and feed-and-seed businesses, which are tied to the agriculture economy.

The public sector employs nearly a quarter of the workers.

The private sector is just not as large in the East. The economy is not as diversified as it needs to be if the school system or a hospital is the largest employer.

How have things improved since 2001?

There's more broadband Internet availability, and natural gas is more available in some regions. We've seen some strategic initiatives such as biotechnology. We see ethanol being looked at as a new driver of demand for crops. We see some things building on the region's strength, such as a new egg-processing plant. We're seeing some boat manufacturers.

Why are the East's problems the state's?

For the rest of the state, there is cost when a region struggles. Some of these counties have very high Medicaid expenses and have trouble supporting their school systems. Tom Lambeth, the former director of the Z. Smith Reynolds Foundation, said it best when he said if you're in a boat and one end springs a leak, you all go down together.

How can the state help?

Policies that will help small business. The East is unusual in that most people work in small businesses. Education is a responsibility of...