Photo by Dave Flessner / Burger King is among many fast-food chains trying to hire more workers

Unemployment fell across Tennessee and Georgia last month to the lowest levels since before the pandemic hit the economy a year and a half ago as wages rose, jobless benefits fell and employers scrambled to fill vacant positions.

The jobless rate fell in August to 4.6% in Tennessee and dropped to 3.5% in Georgia, according to state employment reports issued Thursday. Both states had unemployment rates below the U.S. jobless rate of 5.2% in August after Tennessee and Georgia regained a majority of the more than 800,000 jobs lost in the two states in 2020 due to the pandemic.

As employers try to refill jobs and respond to the economic recovery, employers are having to compete to get workers to fill open positions. On Thursday, Tennessee's career centers were advertising 462,497 open jobs across the state, or nearly 3.3 jobs for each of the 141,194 unemployed persons in Tennessee looking for work last month.

In Georgia, Labor Commissioner Mark Butler said employment actually dropped at restaurants and retail shops by a total of 5,000 workers last month because of fewer workers in the labor market.

"Job growth will become stagnant if we don't fill the hundreds of thousands of jobs that we currently have open right now," Georgia Labor Commissioner Mark Butler said. "We are not seeing the number of Georgians rejoin the labor force at the same pace as we are seeing employers post jobs and we are taking an in-depth look at why."

Jobless in August

Unemployment fell last month to:

* 3.5% in Georgia, down from 3.6% the previous month

* 4.6% in Tennessee, down from 4.7% the previous month

* 5.2% for the U.S. average, down from 5.4% the previous month

Sources: BLS, Tennessee Department of Labor and Workforce Development and Georgia Department of Labor

Despite economic gains over the past year and a half, the labor force participation rate is still down from its pre-pandemic levels.

"We've had more people retire, more two-income households rethinking whether both spouses want to work and more workers re-evaluating their jobs in the wake of the COVID virus," said Bill Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee.

Fox said he expects the economy to continue to improve and employment to continue growing, but the pace of job growth may depend upon getting more workers into the labor market.

Employers are boosting wages and hours for those at work. Manufacturers in Tennessee boosted the average workweek in July from 37.5 hours a year ago to 43.5 hours this year. At the same time, average manufacturing wages in Tennessee jumped by 7.7% in the past year to $21.99 an hour.

Combined, the longer factory workweek and higher pay levels meant average manufacturing pay in July of 2021 was up a whopping 25% over the same month a year ago.

"We're clearly seeing wages go as in response to the challenge of getting enough workers, especially for many lower-paying jobs," Fox said. "Over the past decade, we have not seen much wage growth, but we certainly are now."

The Georgia Department of Labor surveyed workers and employers last month and found that 69% of employers said they have been increasing salaries and benefits to help attract more workers. But many still report problems filling open positions.

"We are hearing from employers who are raising salaries and enhancing benefits package and are still not able to fill these jobs," Butler said. "Based on what we are seeing, it may be months, if not year,s for the job market to return to some type of normalcy."

Tennessee and Georgia were not hit as hard economically by the pandemic last year as some other states were and both states appear to have rebounded more than many parts of the country.

In the past 12 months, employers across Tennessee increased the state's workforce by 121,600 jobs, while employment in the past year grew by 1999,500 jobs across Georgia.

Nonetheless, the labor force participation rate of 60.6% in Tennessee last month was still below the levels before the pandemic. Butler said employment in Georgia is still 107,000 below the pre-pandemic peak.

In July, both Tennessee and Georgia cut off the extra $300 a week federal supplemental wage benefits that were being paid over the past year to unemployed persons looking for work. State officials worried the enhanced jobless benefits were discouraging some workers from returning to work, but the end of the extra jobless benefits did not appear to make a major difference in the size of the workforce.

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