Unemployment in Chattanooga fell last month to 3.8 percent

Unemployment in Chattanooga fell last month to its lowest level in a decade as local employers added nearly 2,300 jobs to boost employment in the six-county area to a record high.

The Tennessee Department of Labor and Workforce Development said Thursday that the jobless rate in metro Chattanooga fell eight tenths of a percentage point to 3.8 percent — the lowest rate since November 2007 before the Great Recession hit the regional economy.

Over the past 12 months, local employers added more than 8,200 jobs, according to preliminary figures compiled by the U.S. Bureau of Labor Statistics. The 3.3 percent job growth in the six-county Chattanooga metro area in the past 12 months was more than double the U.S. rate of growth.

“Nashville, Chattanooga and Cleveland continue to be the three fastest growing areas in Tennessee for job growth, but nearly all areas of the state are showing healthy gains,” said Dr. William Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee. “When you think about Chattanooga and Cleveland as a region, this is certainly a part of the state where we are seeing really robust growth in employment.”

The jobless rate fell even lower during April in metro Cleveland, Tenn., which includes Bradley and Polk counties. Cleveland’s unemployment rate dropped by a full percentage point to only 3.7 percent.

The jobless rate among all 95 Tennessee counties was lowest in the Nashville suburbs in Williamson County, where unemployment fell in April to a mere 2.6 percent, and was highest in Rhea County, where the jobless rate was 6.6 percent despite a 1.6 percentage point plunge in the jobless rate from March.

“One year ago, we had eight counties with an unemployment rate above 6 percent,” Tennessee Labor Commissioner Burns Phillips said. “This April, only two counties in the entire state reached that level. While we still have work to do, it is clear Tennessee is making progress in putting people to work.”

Even in metro Dalton, Ga., which once had one of the highest jobless rates in the country during the Great Recession, unemployment fell last month to a decade low of 5.2 percent, according to figures released Thursday by the Georgia Department of Labor.

Nationwide, the U.S. jobless rate fell last month by a tenth of a percentage point to 4.4 percent and Tennessee’s statewide unemployment rate declined by four tenths of a percentage point to 4.7 percent.

In Southeast Tennessee, unemployment was the lowest in Bradley County at 3.5 percent. Statewide, the jobless rate was lowest in the Nashville suburbs

of Williamson County at 2.6 percent.

Rhea County continued to have the highest unemployment rate last month of any of Tennessee’s 95 counties at 6.6 percent. But Rhea County’s rate still plunged by 1.6 percentage points from the 9.2 percent rate in that county in March.

“I think Tennessee’s economy overall is doing great and pushing forward, but there are some areas like in Middle Tennessee where employers are going to have some major issues with the availability of workers as unemployment

continues to fall and workers have more options of where they might work,” said Murak Arik, director of the Business and Economic Research Center at Middle Tennessee State University in Murfreesboro.

The competition for workers normally pushes wages higher, but the wage growth has remained relatively muted.

“We are seeing upward movement in wages, but not nearly as much as what you would normally expect for this level of health in the labor market,” Fox said.

Many employers, especially those in highly competitive industries, remain reluctant to raise worker pay, especially when many are having to also absorb higher health care insurance premiums.

Jackie Barry, branch manager for the professional staffing agency the Dako Group, said many employers are resistant to raising wage levels even as the competition for qualified workers becomes much greater in a tighter labor market.

“It has become a challenge to fill many positions today,” she said. “Now that there is such a low unemployment rate, job candidates have the ability now to ask for more money. When you have employers that are still going with their old wage rates, it can be more difficult to fill some jobs.”

Barry said when they advertised for workers a couple of years ago, “we would get an influx of people to apply.” In the current market, the number of applicants is not as high and many of those entering the workforce either needs sponsorship because they are foreign students who want to stay in the United States or they are workers with less qualifications.

“The availability of jobs will attract more people to move to Tennessee and encourage more workers who may have dropped out off the workforce to go back to work,” Fox said. “But there is no question that the availability of workers will be a challenge for many businesses as the labor market continues to tighten.”

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