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This story was updated on Tuesday, Jan. 12, 2021, at 6:53 p.m. with additional information and edits.

One of every seven jobs was lost, at least temporarily, between February and April when the coronavirus pandemic hit the U.S. economy, cutting employment for 31,156 Chattanooga area workers.

Over 60% of those lost jobs returned over the next six months, including more than 25,000 of the lost jobs in Chattanooga, according to the U.S. Bureau of Labor Statistics.

But the top researcher at the Federal Reserve Bank in Atlanta says regaining all of the jobs and economic losses from the pandemic will likely take at least another six months and will depend upon how workers adapt to changing job demands.

David E. Altig, executive vice president and director of research at the Atlanta Fed, said the economic picture is still one of "extraordinary uncertainty." But in a speech posted online Tuesday for the Chattanooga Area Chamber of Commerce, the Fed economist said he expects the economy to grow by a relatively healthy 4.2% this year and another 3.2% next year.

"Looking forward the outlook is relatively optimistic," Altig said. "Despite that positive picture, it's still not enough to make up for the decline in GDP we saw to get back to where we were before the pandemic for some time yet."

While most jobs are expected to eventually return to the economy, employment in some types of jobs is not likely to fully recover, especially in many low-skill, service jobs at brick-and-mortar retail shops, restaurants and other sectors reshaped by the pandemic. Employment in the leisure and hospitality industry plunged by 49% last spring and only about 60% of those jobs have since returned, Altig said.

Disproportionately, low-skill and low-income workers have been hit the hardest by the pandemic and Altig said the recovery will depend upon retraining or upskilling many workers for jobs now in demand.

"There was a huge challenge in labor markets of skilling people up and getting them into the new types of occupations for the new economy that existed before the pandemic and now that problem has gotten even worse," he said.

Chattanooga Mayor Andy Berke said even in Chattanooga, which entered 2020 with Forbes magazine predicting that the Scenic City would be a national leader in job growth, unemployment jumped to a record high of 13.3% in April with nearly half of all jobs in the hotel, restaurant and entertainment industry lost, at least temporarily.

"When a pandemic shakes our foundation, the people that are holding on at the edge fall off first," Berke said. "Our services and hourly employees have been hardest hit by the pandemic, but even in the darkness we can build our community back to the image that we want to see when the light returns — a city that is fairer and more prosperous and one where more Chattanoogans live a middle-class life."

Even with the economic slowdown, expansions announced in 2020 by McKee Foods, Gestamp, Southern Champion Tray and others are projected to bring 1,067 new jobs and $676 million of new investment into Hamilton County. The jobless rate in Hamilton County in November fell to 4.3% — 2 percentage points below the U.S. average and less than a third of the peak levels seven months earlier.

Altig said the challenge for Chattanooga and most cities moving forward is to better align worker skills to the jobs of the 21st century.

"Taking those low-skilled workers and moving them into higher-paying, more resilient jobs is absolutely critical," he said. "It is paradoxical that you can have a labor shortage and labor surplus at the same time."

The Chamber recently launched a new site called Chattanooga Calling intended to connect job seekers to work and training opportunities, and sell the story of the Scenic City to folks considering a move. In its first month, more than 6,000 visitors have come to the website looking for jobs, which currently includes 3,390 job listings in the Chattanooga area.

"Right now we are focused on trying to find jobs for those who are unemployed and find that link for those companies who have openings and desperately need workers," said Christy Gillenwater, president and CEO of the Chattanooga Chamber.

Altig praised the Chattanooga Calling program and urged investments in programs that improve workers' occupational skills. The Fed economist noted that moving a minimum-wage worker to a computer user support specialist would yield a return back to taxpayers of $75,000 within five years and up to $300,000 over the person's lifetime.

"The opportunity to the public and the return on the investment is enormous," Altig said.

In the short term, Altig said the economy still depends heavily on the spread of the virus and the speed at which the vaccines mitigate the pandemic.

Hamilton County Mayor Jim Coppinger said he hopes to speed the delivery of vaccines in coming weeks "and it is my sincere hope that by this summer we will be somewhere near normal again.

"I believe we will move beyond our current challenges to even better times in the near future," Coppinger said.

Reporter Mary Fortune contributed to this report.

Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340

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