Chattanooga income gains double U.S. average

Friday, January 1, 1904

photo Dr. Bill Fox, director of the University of Tennessee Center for Business and Economic Research

Personal income in Chattanooga grew nearly twice as fast as the U.S. average last year and outpaced other metropolitan areas across the mid-South, according to newly released government figures.

But a growing share of Chattanoogans' income continued to come from the government in 2010.

The U.S. Bureau of Economic Affairs estimates that net earnings last year rose by 4.1 percent in metropolitan Chattanooga to a total of $464 million, reversing the 5.1 percent drop in net earning during the previous year when the economy was still in decline. Earnings increased both from higher wages and the addition of 4,900 jobs in the six-county Chattanooga metropolitan area during 2010, or 2.2 percent of the metropolitan workforce.

The earnings gain outstripped the 2.3 percent gain in such wage and profit gains nationwide last year, government figures show. Chattanooga's job gains last year were more than twice the rate for all of Tennessee and more than 10 times the growth rate in Georgia, according to the U.S. Bureau of Labor Statistics.

Government transfer payments such as Social Security, jobless benefits and food stamps rose by an even faster 7.2 percent in metro Chattanooga to $280 million during 2008 after increasing by 10.9 percent the previous year, government figures show. Nationwide, government transfer payments rose by 7.8 percent in 2010, or more than triple the gain in wages and dividends last year.

"During recessions, we tend to see government transfer payments go up while earnings are flat or go down," said Bill Fox, director of the University of Tennessee's Center for Business and Economic Research. "In 2009, the economy was still in recession while last year we began to see positive growth in the economy. Unemployment remains high, but we are seeing gains in personal income."

Income in metropolitan Cleveland, Tenn., also outpaced the national growth rate last year with personal income growing in Bradley and Polk counties to $113 million, up 3.3 percent from the previous year.

"The metropolitan areas of the state are generally growing faster than rural areas in this recovery," said Murat Arik, associate director of the Business and Economic Research Center at Middle Tennessee State University. "But there is still a lot of uncertainty and not the level of growth we're used to seeing in most recoveries."

Some metropolitan areas still grew less than the U.S. average last year. Personal income in both Atlanta and Dalton, Ga., grew less than the national average last year. Both areas are heavily dependent upon construction and have suffered more than most cities during the recent recession.

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