The Raleigh-Cary metro area has earned an overall grade of A, ranking in the 71.0th percentile among 50 US metros, with a strong labor demand and low unemployment rate defining its current economic character. The labor demand composite score of 8.49, combining a 2.27% employment growth rate and a 1.008% weekly hours deviation above trend, signals a genuine demand expansion. This is further reinforced by an unemployment rate of 2.70%, indicating a tight labor market.

Labor Demand

The Raleigh-Cary metro area is experiencing a strong labor demand, with a 2.27% employment growth rate and a 1.008% weekly hours deviation above its own trend. This combination signals a genuine demand expansion, where jobs are being added and hours are running above trend. The labor demand composite score of 8.49, ranking in the 98th percentile, confirms this robust labor market.

Unemployment

The unemployment rate in Raleigh-Cary is 2.70%, ranking in the 94th percentile, indicating a very tight labor market. This means that businesses may face challenges in hiring, as the pool of available workers is limited, and may need to offer competitive wages to attract talent. The low unemployment rate also suggests that workers have strong bargaining power.

Wage Growth

The year-over-year wage growth in Raleigh-Cary is 3.23%, ranking in the 34th percentile, indicating moderate wage growth. While this is not exceptionally high, it still suggests that labor costs for employers are rising, and workers are experiencing an increase in purchasing power. However, the moderate pace of wage growth may not be sufficient to keep up with the cost of living in the area.

Cost of Living

Raleigh-Cary has a cost of living score ranking in the 80th percentile, with a PSF of $213/sqft, which is decreasing by 3.2% year-over-year, and an average hourly earnings of $38.12/hr, resulting in a ratio of 5.59. This indicates that the city is relatively affordable compared to its peers, making it an attractive location for talent without requiring significant wage premiums. The decreasing PSF is a key driver of this affordability.

Labor Force Growth

The civilian labor force in Raleigh-Cary is growing at a rate of 0.92% year-over-year, ranking in the 80th percentile, indicating an expanding workforce supply. This suggests that businesses have a growing pool of potential workers to hire from, making it easier to find talent. The positive labor force growth also implies that the city is likely to maintain its economic momentum.

Building Permits

The number of residential building permits in Raleigh-Cary has decreased by 22.66% year-over-year, ranking in the 12th percentile, indicating a tightening housing supply. This suggests that the city may face future affordability challenges and workforce accommodation constraints, as the demand for housing is not being met by new supply. The decline in building permits is a concern for businesses relying on a steady influx of new workers.

Days on Market

The median days on market for homes in Raleigh-Cary is 64 days, with a year-over-year increase of 6.7%, ranking in the 18th percentile. This indicates a slower market, where homes are taking longer to sell, making it more accessible for workers relocating to the city. However, the slow pace of sales may also suggest a softening demand for housing.

Office Economy

Raleigh-Cary has a deep professional talent pool, with an office economy score ranking in the 98th percentile, indicating a strong presence of professional and office sectors. This makes the city an attractive location for businesses in the tech, finance, consulting, and HQ sectors, which require specialized knowledge workers. However, it may not be as suitable for industries with more industrial or logistics-oriented workforces.

The Raleigh-Cary metro area offers businesses a strong labor market, low unemployment, and a relatively affordable cost of living, making it an attractive location for talent and investment. However, the single biggest risk or constraint for decision-makers is the decline in building permits, which may lead to future affordability challenges and workforce accommodation constraints, potentially limiting the city's long-term economic growth.