Introducing the County Economic Vitality Index

How is my county doing economically? And are we getting better? These are two common questions we receive about North Carolina’s economy. The answers are harder to nail down than they should be. Single indicators like unemployment or income tell only part of the story. National datasets often lack county-level detail. Without consistent benchmarks, it's difficult to know whether local conditions reflect broader trends or something unique to the community.

The County Economic Vitality Index developed by LEAD is designed to help to address this gap. It provides a transparent, comparable measure of county economic performance that tracks progress over time and benchmarks results against the nation. While no single measure can completely explain the complexities of a state or regional economy, the Index is designed to be an intuitive starting point, accessible to general audiences.

In a companion article, we shared 10 findings from the Index revealing patterns in North Carolina's economic geography. This post explains how the Index works, outlines the methodology behind it, and shows how readers can explore the data themselves.

What the Index Measures

The Index tracks four indicators that together paint a broad picture of a region’s economic condition:

Several factors guided the selection of measures:

• Relevance to regional economic conditions
• High-quality data from established public sources
• Availability at the county level
• Statistical independence, ensuring indicators are not highly correlated
• Annual publication with historical data to allow trend analysis
• Objectivity, avoiding bias toward specific counties or situations

For educational attainment, the Index measures the share of adults with at least a high school diploma rather than focusing on college degrees. High school completion represents a more universal economic threshold—lacking a diploma severely restricts job access and advancement, while many well-paying careers (including skilled trades and military service) don't require college degrees. This approach better captures baseline workforce readiness across diverse local labor markets.

How It Works

Each indicator is benchmarked against the U.S. average in the same year, producing a component score where 100 equals the national average. A county with an unemployment rate lower than the nation’s scores above 100 on that component; a county with wages below the national average scores below 100. The four component scores are then averaged with equal weight—25 percent each—to produce a single composite score. Equal weighting is used for transparency and simplicity: no single indicator is assumed to carry more importance than the others, and the method is straightforward to explain and replicate.

The result is intuitive. A composite score of 95 indicates a county is performing about 5 percent below the national benchmark across all four dimensions, while a score of 105 means it’s outperforming the nation by a similar margin.

The score is calculated by averaging four components - unemployment, wages, income, and education - each compared to the U.S. average:

Index Score = (Unemployment Component + Wage Component + Income Component + Education Component) / 4

Each component is calculated as:

Component = (County Value / U.S. Value) × 100
with unemployment inverted so lower rates yield higher scores.

Index Relationship to Community, Business, and Workforce Success

Index scores from 2010 were compared to economic outcomes over the following 14 years. A regression analysis showed a positive relationship between a county’s 2010 score and its 2011-2024 rates of growth in population, the number of private sector business establishments, and private sector employment (jobs). This suggests counties with higher Index scores experienced stronger growth in jobs, businesses, and population – indicating the Index captures underlying conditions favorable to private economic growth, though this correlation does not establish causation. 

For example, a county scoring 10 points higher on the 2010 Index experienced, on average, roughly 10 percentage points more job growth, 14 percentage points more business establishment growth, and 10 percentage points more population growth over the following 14 years.

Explore the Data

The full dataset is available through an interactive table that lets you search for any county, compare component scores, and see how performance has changed year to year. We encourage readers to dig in and find the story behind their own community’s numbers.

Download the full dataset.

Limitations

The Index focuses specifically on core economic fundamentals and does not account for factors such as cost of living, industry diversification, or quality-of-life measures – all of which also contribute to community economic vitality. All factors are treated equally with no weighting, which simplifies both measurement and communication of results. The LEAD’s analysis of 15 years of county-level data indicates this approach is sound, as the variance within counties is generally too small to distort results. The same methodology could be used to compare states, but weight adjustments would likely be preferrable given the larger differences across the country.

What’s Next

The Index opens the door to a range of future analyses. Upcoming work could explore individual Index factors in greater depth, analyses of particular state and county changes, more details about the relationship between county scores and growth outcomes, a comparison of the state’s eight Prosperity Zones, and benchmark North Carolina against national peers. We look forward to continuing to share the insights the data reveals.