Unemployment falls to pre-pandemic lows in Tennessee and Georgia

Photo by Dave Flessner / McDonald's on Gunbarrel Road in Chattanooga is eager to hire more workers and is offering higher pay and social media applications to fill vacant jobs.

Unemployment in Tennessee and Georgia fell last month to the lowest monthly level since the pandemic hit the economy in early 2020 as employers continued to add more workers and jobless claims dropped as both states limited benefits for those still unemployed.

The jobless rate in July fell to 3.7% in Georgia and 4.7% in Tennessee with both levels far below the U.S. average unemployment last month of 5.4%, according to job figures released Thursday.

Although both states are below their pre-pandemic employment peaks, Tennessee and Georgia collectively added 346,600 jobs between July 2020 and July 2021.

"Tennessee was not hit as hard as some states during the pandemic and we seem to be recovering more quickly," said Dr. Bill Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee. "That said, labor force participation still isn't back to what it was before the pandemic and undoubtedly some people are staying out of work because of COVID fears, childcare problems or other challenges brought on by the pandemic. That should improve with school reopening this fall."

Tennessee's jobless rate last month was the lowest since March 2020 when unemployment was 4% just before the pandemic shut down much of the economy. Georgia's unemployment also was at an 18-month low just a fraction above the 3.6% rate in March 2020.

Jobless in July

The unemployment rate declined last month and stayed below the national average in Tennessee and Georgia.3.7%: Georgia unemployment rate, down 0.3% from June4.7%: Tennessee unemployment rate, down 0.2% from June5.4%: Average U.S. unemployment, down 0.5% from JuneSources: Tennessee Department of Labor and Workforce Development, Georgia Department of Labor and U.S. Bureau of Labor Statistics.

"After ending Georgia's participation in the federal unemployment insurance programs in June, the state has seen the growth of almost 84,000 jobs and has seen a 300% increase in the number of people employed from June to July," Georgia Labor Commissioner Mark Butler said.. "We are seeing all-time high job numbers in many sectors. The job market is saturated with opportunities for job seekers, and we are working to connect employers with candidates for long-term employment."

Both Tennessee and Georgia ended their federally funded $300 a week supplemental benefits for unemployed persons just before the July employment data was compiled. Despite criticism that the states were turning down federal aid to help jobless persons, state officials said the extra benefits were discouraging some unemployed persons from returning to work.

Restaurants and many service industries report having trouble filling available jobs. Most fast-food restaurants in Chattanooga are displaying hiring signs along with their menu specials and some eateries are even having to limit or in some instances suspend operations because of a lack of workers.

Hummingbird Pastaria, the longtime staple of Signal Mountain, says on its website it has been forced to close due to a staffing shortage. A new Waffle House that opened in East Brainerd is open only 7 a.m. to 2 p.m. each day as the restaurant tries to hire more staff.

Statewide, the Tennessee Department of Labor and Workforce Development estimates that 156,571 Tennesseans were unemployed in July. But on Thursday, the department's online job listing, Jobs4TN.gov, listed 458,478 jobs, or nearly three jobs for every unemployed person in the state.

The tight labor market is boosting wages, especially among many lower-paying service industries, Fox said. But even manufacturers are having to pay more to fill vacant jobs. The average manufacturing wage rate in Tennessee rose in July to $21.99 an hour. Although that was still below the U.S. average manufacturing wage of $23.83 an hour, higher wages and longer workweeks pushed the average annual pay for manufacturing workers in Tennessee during July to an all-time high of nearly $49,742.

"I've been in this business nearly 30 years and I've never seen a tougher market to fill jobs," said Lois Crandell, president of the GE Roper plant in Lafayette, Georgia.

Crandell said GE Appliances boosted its average factory pay by 70 cents an hour in July, in part, to help recruit more needed workers.

Contact Dave Flessner at [email protected] or at 423-757-6340.