Nashville, Chattanooga grow strongly in U.S. data

The economies of Nashville and Chattanooga grew the most quickly among Mid-South metropolitan areas during 2006, according to a government report released Thursday.

But the U.S. Bureau of Economic Analysis said the smaller neighboring metro areas around Chattanooga suffered a slight economic decline from 2005 to 2006 as manufacturing continued to shrink.

“We’ve seen job losses in manufacturing pretty continuously since 2003 and that has hit smaller towns and rural areas the most in Tennessee,” said David Penn, director of the Business & Economic Research Center at the Middle Tennessee State University. “The I-24 corridor has continued to be one of the growth areas of the state and that has helped both Nashville and Chattanooga.”

The agency estimates the broadest measure of economic production known as gross domestic product grew in metropolitan Chattanooga by a healthy 5.8 percent to $19.1 billion in 2006.

Among major metro areas in the region, Chattanooga’s growth pace trailed only Nashville’s 6.9 percent jump in GDP in 2006 and easily outpaced the U.S. growth rate of 3.2 percent.

The 2006 growth pace in Chattanooga was double the 2.9 percent increase in GDP the previous year and was more than double the statewide growth pace in 2006 of 2.5 percent.

But the economies of both Dalton, Ga., and Cleveland, Tenn., declined in 2006 because of continued job losses in manufacturing, according to the government report. Dalton’s $5.1 billion economy shrunk by $65 million during 2006, while Cleveland’s estimated economic $3.1 billion output in 2006 was down $30 million from the previous year.

Gary Farlow, vice president of economic development for the Cleveland/Bradley County Chamber of Commerce, said Cleveland’s economy has remained diversified and still includes nearly twice the share of manufacturing jobs as the U.S. average.

“We’ve had some ups and downs among our manufacturers over the years, but we actually are having very good prospect activity right now despite the economic slowdown,” he said.