Unemployment fell last month to an all-time low in Georgia and dropped to a 2-year low in Tennessee where there are currently more than four times as many job openings as unemployed people.
The jobless rate in December fell by two-tenths of a percentage point in Tennessee during December to 3.8%, the lowest rate since January 2020. In Georgia, unemployment declined last month to 2.6% - the lowest level on record.
In neighboring Alabama, the seasonally adjusted jobless rate held steady at 3.1%, well below the U.S. unemployment rate of 3.9% at the end of last year
"We had really solid employment growth across most sectors of the economy to cut the unemployment rate even with an increase in the labor force," Dr. Bill Fox, director of the Boyd Center on Business and Economic Research at the University of Tennessee, said in a telephone interview. "I think there is generally good news in this December report, and we expect that to continue in 2022."
Tennessee employers last year added 96,400 jobs to bring the state's employment total to within 32,000 of its all-time peak reached two years earlier before the COVID-19 pandemic slowed the economy and temporarily pushed the state's jobless rate up to a record high of 15.8% in April 2020. Unemployment has steadily declined over the past 20 months.
Georgia added 198,200 jobs over the past year to bring its employment total to over 4.6 million, making up for more than 97% of the jobs lost during the pandemic.
"Although our unemployment rate is one of the lowest in the nation, we have to focus on getting people back into the workforce to fill the jobs Georgia businesses are creating," Georgia Labor Commissioner Mark Butler said in his monthly labor market report. "Now is one of the best times we have seen for finding employment."
Alabama's seasonally adjusted jobless rate has held steady at 3.1% for the past five months, and the addition of another 7,000 jobs in the state last month helped absorb the increase in the labor force.
"We all know of the challenges facing today's workforce, most of which are still pandemic related, and we're grateful that Alabama is weathering these challenges," Alabama Labor Secretary Fitzgerald Washington said in a statement Friday. "Since last year, more than 36,000 people are no longer counted as unemployed."
But the number of workers on the job or looking for work still hasn't rebounded to pre-pandemic levels. Fox said a wave of retirements during the pandemic from the aging workforce, combined with many parents and young people kept out of the workforce by school closings, sicknesses or simply changed lifestyles, have all combined to shrink the labor force participation rate and limit the availability of workers, even with recent wage increases and higher hiring activity.
On Friday, the Tennessee career center listed 425,215 job openings, or more than four times as many as the 109,741 people in Tennessee counted as unemployed and still seeking a job in December.
Jobless in December
Georgia: 2.6%, down from 2.8% in November.Alabama: 3.1%, unchanged from November.Tennessee: 3.8%, down from 4% in November.United States: 3.9%, down from 4.2% in November.Sources: U.S. Bureau of Labor Statistics, Tennessee Department of Labor and Workforce Development, Georgia Department of Labor, Alabama Department of Labor
Fox said he doesn't expect the labor force participation rate to return to its previous peak levels for some time.
After announcing billions of dollars of new business investment in Tennessee last year, including the ambitious Ford project in West Tennessee, demand for workers is expected to remain elevated for some time even with higher interest rates, Fox said.
A new economic analysis of Tennessee by the bond agency Fitch Ratings noted that Tennessee suffered less economically than most of America during the pandemic and its employment gains have been stronger coming out of the COVID-19 lockdowns.
"Tennessee's labor market contracted by 12% between March and April 2020, milder than the nation's 15% decline in nonfarm payroll employment," Fitch analyst Michael D'Arcy said in a report that reaffirmed Tennessee's favorable AAA bond rating. "The state's employment recovery has also been faster than the nation's."
Butler said states like Georgia that have resisted stricter rules for businesses during the pandemic have fared better. Butler said New Jersey's and New York's unemployment rate of 6.6% during November 2021 was two and a half times that of the Peach State. Nevada is still under an indoor mask mandate in most counties and ranked 50th nationally with an unemployment rate of 6.8%, right above California's rate of 6.9%.
The tight labor market is encouraging more workers to quit their jobs and find somewhere else to work. WalletHub reported Friday that Georgia had the third highest quit rate for employees among all the 50 states. Alabama had the 19th highest resignation rate and Tennessee ranked just above average at No. 23 among the 50 states measured for the share of workers quitting their jobs.
Contact Dave Flessner at firstname.lastname@example.org or 423-757-6340.