Photo by Dave Flessner / The Domino's Pizza store in Red Bank is seeking more workers as the unemployment rate fell across Tennessee last month. New jobless claims still rose and unemployment is more than double what it was a year ago in Tennessee.

Unemployment fell across Tennessee last month to its lowest level in six months, but the number of working Tennesseans was still down by 131,500 from a year ago and initial jobless claims from newly laid-off workers rose again last week.

In neighboring Georgia, where the jobless rate plunged in August to one of the lowest rates in the South, unemployment edged higher last month, rising 0.7 percentage points over August to 6.4% in September. Initial jobless claims in Georgia and across the country also rose last week, suggesting that the pace of the economic expansion may be slowing.

"We continue to make progress, but job growth is slowing and it's going to be a long time until we regain all of the jobs that we lost during this pandemic," said Bill Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee. "Some of the declines we're seeing in the unemployment rate reflects the fact that more people have just dropped out of the labor force and a lower share of the population is now working."

The jobless rate in Tennessee dropped to 6.3% in September, down from the 8.6% rate in August and less than half the 15.5% peak unemployment rate reached in April when the COVID-19 shutdowns were at their worst.

The Tennessee Department of Labor and Workforce Development said employers across the state created 11,100 new nonfarm jobs between August and September. Many of the hardest-hit sectors of the economy hurt by the pandemic earlier this year showed the biggest job gains last month with employment up last month in the leisure and hospitality sector by 9,300 jobs, retail trade by 4,700 jobs and manufacturing by 1,500 jobs.

Tennessee's jobless rate remained below the U.S. average in August. The seasonally adjusted rate for the United States last month was 7.9%, down from August's revised rate of 8.4%.

But unemployment in Tennessee is still more than double the 3.5% rate a year ago in August 2019 and employment is down by 4.3% in the past 12 months. Due to shorter workweeks, the average manufacturing worker in Tennessee was paid only $840.49 per week last month, or $30.59 per week less than a year ago.

Unemployed Tennesseans are faring even worse as benefit checks have shrunk for many — and ended for others. Last week, the average jobless benefit paid to unemployed workers in Tennessee was $313.56 — or only about 40% of what was being paid to jobless workers in July. The number of jobless recipients last week also fell by more than 30% as new job search requirements were restored in order to qualify for benefits and more persons reached the end of their 26-week period for state unemployment insurance benefits.

Through July, the federal government provided a $600 weekly supplement on top of the state jobless benefits paid in each week.

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Tennessee unemployment rate for September 2020. / The Tennessee Department of Labor and Workforce Development

Jobless in September

* Tennessee: 6.3%, down from 8.6% in August

* Georgia: 6.4%, up from 5.7% in August

* U.S. average: 7.9%, down from 8.4% in August

Source: U.S. Bureau of Labor Statistics, Tennessee Department of Labor and Workforce Development, Georgia Department of Labor.

"That provided a great economic boost for many and, combined with the $1,200 per person stimulus checks and people shifting their purchases away from vacations, travel and elective surgeries, kept a lot of Tennesseans buying taxable goods in the state," Fox said.

That helped push up sales tax collections for Tennessee in each of the first three months of the new fiscal year, surpassing budget projections.

But Fox cautions that those sales tax gains could stall now that jobless benefits are being cut and other stimulus and Paycheck Protection Program loans are ending.

The job search website Indeed said its job postings were unchanged last week, remaining about 17% below last year's levels. Many employers still aren't confident enough in their businesses or in their view of the economy to ramp up hiring. Job postings had rebounded steadily over the summer, but the gains have slowed in the past two months.

"Further recovery looks to have stalled out," said AnnElizabeth Konkel, an economist at Indeed. "Holiday hiring is sluggish, and many businesses need to make significant changes to ride out the colder months."

Mark Hamrick, the senior economic analyst for, said the latest jobless claims data suggest the economy remains sluggish with 898,000 Americans filing new claims for jobless benefits last week.

"Some 30 weeks since the pandemic-caused downturn began, we see a disappointing increase in the number of new seasonally adjusted claims," he said. "There is a risk of stagnation in the coming months as layoffs mount, and more businesses struggle or fail."

The Federal Reserve forecasts that the U.S. economy won't reach so-called full employment again until 2023.

But in an announcement of the September jobless figures, Chris Cannon of the Tennessee Department of Labor and Workforce Development noted that "businesses across the state are ready to reemploy Tennesseans."

The Georgia Department of Labor said employment grew in the Peach State by 20,200 jobs in September, but unemployment grew because the workforce grew even faster.

"Over the past five months, 340,900 jobs (65% ) have been gained back from the massive job loss we saw in April," said Georgia Labor Commissioner Mark Butler.

Tennessee's workforce development website,, currently lists more than 210,000 open positions for job seekers.

Besides current job openings, also provides online assistance with writing a resume that will catch the attention of employers, advice on how to engage and impress during job interviews, and details about potential job training opportunities, Cannon said.

Contact Dave Flessner at or at 423-757-6340.