Unemployment in Tennessee fell last month to the lowest level in nearly three years while the jobless rate in neighboring Georgia declined into single digits for the first time since last spring, the labor departments in both states reported Thursday.
With an early start to Christmas, holiday hiring helped cut Tennessee's unemployment rate by 0.4 percent during November to 9.1 percent. That was the lowest rate in the Volunteer State since January 2009 when President Barack Obama was sworn into office.
"After seasonal adjustments were made, nearly 10,000 jobs were created since October with positive job growth in the service sector such as retail trade and temporary jobs," Tennessee Labor Secretary Karla Davis said.
Over the past year, employment in Tennessee has grown by 2 percent with the addition of 56,100 more jobs. Tennessee's growth rate is nearly twice the 1.2 percent employment growth nationwide.
"Tennessee is growing jobs at a faster pace, but it is also attracting more workers back into the labor market so unemployment remains above the U.S. average and I'm afraid it is going to remain at historically higher levels for some time," University of Tennessee economist Matt Murray said.
In Georgia, unemployment declined by 0.3 percent to 9.9 percent in November. The one-month decline is the largest in 34 years with the addition of 22,400 jobs.
"We had the best November since 2007 for retail hiring, while seeing gains in the financial and business sectors," Georgia Labor Commissioner Mark Butler said. "These two sectors have been hit very hard by the recession. This is encouraging news."
The job gains came despite continued job losses in state and local government. In Georgia, for instance, 22,500 state and local government jobs have been cut over the past year.
"I think its evidence that our state and local leadership is being sensitive to the taxpayer and trying to make government live within its means," Butler said.
Both states also reported fewer claims for unemployment benefits. Nationwide, the number of people filing for unemployment benefits fell last week to the lowest since May 2008, a sign that the waves of corporate layoffs that have defined the past few years are all but over.
"This is unexpectedly great news," said Ian Shepherdson, an economist at High Frequency Economics.
It will take an additional step -- robust hiring, not just the end of layoffs -- to bring the 8.6 percent unemployment rate down significantly. Experts say that won't happen until businesses are more confident about customer demand. And the European debt crisis still could cause damage here.
But the report on unemployment claims Thursday was the latest to suggest that the economy, 21/2 slow years after the official end of the recession, finally may be picking up momentum.
The Associated Press contributed to this report.