Charlotte's Role as a Financial Center: Looking Beyond Bank Assets

Studies of financial activities generally focus on the location of assets. Charlotte is often revered as the newest and second-largest banking center in the U.S. in terms of the total assets held by the locally headquartered banks (Bank of America and First Union). Deeper evaluations of financial activity reveal that despite the magnitude of the local asset base, financial employment and wage levels are close to the national average. In terms of the percentage of total employment in the FIRE sector, Charlotte ranks below similar-sized cities such as Jacksonville, Richmond, or Columbia. Examination of the relationship between bank assets and financial-sector employment suggests that the Charlotte banks have a smaller local economic impact per dollar of assets than other regional banks. These results suggest that the high visibility of the banking industry in Charlotte may overshadow the diversity of the area's economy and overstate the economic contributions of the city's most prominent employers.