Unemployment in Tennessee is projected to fall next year to 7.5 percent but remain above the U.S. rate, according to a University of Tennessee forecast released today.
UT's Center for Business and Economic Research predicts the economy of the Volunteer State will continue to grow this year and pick up more momentum in 2014 and 2015. Despite sequestration of federal spending and a payroll tax increase that have slowed consumer spending so far this year, the economy is still growing and the jobless rate should fall gradually this year and next.
"The economy has finally found a firm footing," Matt Murray, associate director at the Center for Business and Economic Research, said in a statement today. "This will be the third year of payroll employment growth and a falling unemployment rate following the Great Recession."
The national unemployment rate dropped to 7.7 percent in first quarter of the year and is expected to average 7.6 percent this year, compared to 7.8 percent in 2012. It is predicted to fall to 7.2 percent in 2014.
Additionally, payroll employment for the nation is projected to be up 1.5 percent this year and 1.6 percent next year, according to the report.
Tennessee's unemployment rate is projected to average 7.8 percent this year compared to 8.0 percent last year. It is expected to fall to 7.5 percent in 2014, according to the report.
The first quarter of 2013 showed Tennessee performing better than most states. An index of economic momentum released by State Policy Reports placed Tennessee in the 12th position across all states for first quarter economic performance. This index is a composite that includes personal income growth, employment growth and population growth.
Tennessee nonfarm employment is expected to be up 1.7 percent in 2013 and 1.8 percent in 2014.