RALEIGH, N.C. (AP) -- Thousands of North Carolina residents quit looking for work in February, a development that cut the state's unemployment rate slightly to 9.4 percent from 9.5 percent in January, the state Commerce Department said Thursday.
That remained well above the national rate of 7.7 percent for the month.
North Carolina's unemployment rate rose to 9.5 percent in January as more than 9,100 people entered the labor force, the state agency reported earlier this month. That turned around in February, with more than 11,000 workers suddenly no longer working or looking for work.
The slightly lower unemployment rate may be in large part because thousands of people exited the competition for jobs, said Gardner-Webb University business school dean Anthony Negbenebor.
"What is happening, honestly, is for the first time in the history after the Depression, we have a much higher number of discouraged workers," he said. "They are so gradually testing the market now. They are coming back gradually, but not as fast as they did 10 years ago" following another recession.
Negbenebor noted that the month-to-month jobless rate can bob up and down, but the prevailing trend is that the economy is slowly and steadily improving. Although the state unemployment rate has barely improved from 9.5 percent in February 2012, the state's non-farm workforce of 4 million grew by 81,000 workers in the past year, Elon University economist Mark Kurt said.
"The year-to-year changes are more interesting and tell a better story for what's been happening for North Carolina. And Those look actually pretty positive," Kurt said. "That was pretty broad-based across industries."
Construction was the only major industry that continued to shed workers over the past year, with 2,800 fewer jobs. But housing prices are going up nationally, so lagging construction employment could turn around in the coming months, Kurt said.
The broad federal spending cuts that took effect this month can be expected to slow the economic rebound but won't reverse it, Negbenebor said.
"It is like a child that has pulled a tooth, and the new tooth is growing with pain," he said. "The sequestration will give us some pain, some bottlenecks. Once we get used to sequestration and adjust to the new course, then the economy will gradually pick up."
Emery Dalesio can be reached at http://twitter.com/emerydalesio