Despite growing economic worries over higher inflation and interest rates, employers continue to add jobs and boost overall employment to record highs in both Tennessee and Georgia this summer.
Unemployment fell below 3% in Georgia for the first time ever last month, while the jobless rate in Tennessee remained at a near-record low of 3.3% in June, according to data released Thursday. Over the past year, employers in Tennessee have added 130,600 jobs, boosting employment to its highest level on record in the Volunteer State. In Georgia, employment is up 246,300 from a year ago, also a record high.
"We continue to see a very strong labor market, and Tennessee continues to lead the nation in job growth," Donald Bruce, director of the Boyd Center for Business and Economic Research at the University of Tennessee, said Thursday in a telephone interview. "Unfortunately, that's a little too strong for the Federal Reserve, which is trying to slow economic growth and inflation right now (with higher interest rates and a tighter monetary policy). We're in a good, but not great, news environment right now with the Fed trying to cool things down."
Georgia Labor Commissioner Mark Butler said Thursday that the number of Georgians on the job topped 4.8 million for the first time, reflecting continued growth in the state's economy even with an uptick in interest rates and a downturn so far this year in the stock market.
"We have never seen an unemployment rate below 3%," Butler said in a report Thursday. "The unemployment rate is decreasing exactly the way it should in a strong economy. We are adding new job seekers and they are quickly finding employment."
But a new survey of Chattanooga area political and business leaders finds most expect the job market and overall economy may soon change. Among 90 local leaders responding to a new Power Poll, 64% said a recession is "somewhat likely" and nearly 37% said a recession is "very likely" within the next year.
The survey, conducted Monday through Thursday, was sent to 229 people, and 90 replied, for a response rate of 39%. The monthly survey by a Nashville organization gauges what regional business, civic, education and nonprofit leaders and elected officials are thinking. While the survey is not a scientific poll, its results offer insights into the opinions and beliefs of key decision-makers in the area.
Bruce said he expects economic growth to slow as higher interest rates and inflation steal away from some purchases and consumer spending.
"We're all trying to figure out when, if at all, things may turn down," he said. "But the good news is that we may not see as much of a downturn in Tennessee."
Bruce said the Volunteer State continues to draw more residents and businesses seeking lower costs of living and what many see as a more favorable living environment, especially in an era when remote work allows some employees to do their job wherever they want to live.
Jobless in June
The unemployment rate continued to decline last month to:— 2.9% in Georgia, down from 3% in May and down from 4% a year ago.— 3.3% in Tennessee, unchanged from May and down from 4.4% a year ago.— 3.6% in the U.S., unchanged from May and down from 5.4% a year ago.Source: Georgia Department of Labor, Tennessee Department of Labor and Workforce Development and U.S. Bureau of Labor Statistics.
Wages jump
The employment report released Thursday by the Tennessee Department of Labor and Workforce Development shows employee wages are also rising with the growth in employment.
The average hourly manufacturing wage in Tennessee in May was up 6.3% from a year earlier. Combined with a 2.6% increase in the average workweek, the typical manufacturing worker in Tennessee was paid 9.1% more in May 2022 than 12 months ago, which topped the 8.6% inflation rate for the same period, according to the Department of Labor.
But even with higher wages, employers still continue to struggle to fill vacant jobs.
"Overall, this is the most difficult hiring period in the 35-plus years I have worked in health care," said Debra Moore, a senior vice president at CHI Memorial Hospital.
Volkswagen of America, which is hiring 1,000 more workers this year to help build its new ID.4 sports utility vehicle, is offering $3,000 signing bonuses to those who are hired.
Job listings
Tennessee career centers on Thursday listed 323,195 vacant jobs, or nearly three open positions for each of the 112,020 Tennesseans who were counted last month as unemployed but still looking for work.
Unemployment rates in June in both Tennessee and Georgia were below the U.S. jobless rate of 3.6% and both of the Southern states reported faster job growth than the U.S. in the past year.
Tennessee's civilian workforce also increased last month to the highest level since the state started tracking the statistic. The new numbers increased the state's labor force participation rate from 61.1% to 61.2%.
The share of adults on the job was even higher to the south in Georgia.
"Georgia ranks highest in the Southeast and third highest of the 10 most populated states with a labor participation rate of 62.3% for May," Butler said.
Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340. Follow him on Twitter @dflessner1.