Influx of workers boosts jobless rate in January

Despite a jump in the jobless rate at the start of 2017, Tennessee continued to outpace the nation in job growth over the past year and should continue to improve in 2017, the state’s top economist said Friday.

Unemployment in Tennessee increased by an unexpected threetenths of a percent in January to its highest level in 16 months. The Tennessee Department of Labor and Workforce Development said the state’s jobless rate at the start of the year was 5.4 percent — a rate nearly 15 percent higher than the U.S. jobless rate of 4.7 percent in January.

But the higher unemployment rate in Tennessee was largely due to an influx of workers into Tennessee’s labor pool, which increased the state’s workforce by 76,600 workers, or 2.5 percent, in the past year, exceeding the 54,100 jobs added over the past 12 months, according to the household employment survey prepared by the U.S. Bureau of Labor Statistics.

Tennessee’s 1.8 percent gain in jobs in the past year still outstripped the 1 percent gain nationwide in employment from January.

“Employment growth in Tennessee still remains very strong, even with this higher unemployment rate,” said William Fox, director of the Center for Business and Economic Research at the University of Tennessee. “Job growth in Tennessee is not quite as great as what we were seeing 18 months ago, but on any kind of long-term standards, a 1.8 percent annual employment growth rate is still very strong.”

In January, typically a month with a drop in jobs following the holidays, Tennessee’s total nonfarm employment increased by 1,200 jobs with the largest employment

increases in trade, transportation, hospitality and construction.

“Our workforce is strengthened with increased opportunity, as international companies continue to invest in Tennessee and the advantages we offer,” said Burns Phillips, commissioner of the state’s Department of Labor and Workforce Development.

The German- based Volkswagen, Japanese- based Nissan and the Swedish- based Electrolux are expanding facilities in Chattanooga, Smyrna and Memphis. Earlier this week, the South Korean appliance maker LG Electronics announced it will build a $ 250 million plant and add 200 jobs in Clarksville, Tenn.

Among manufacturing workers in Tennessee, the average workweek remained strong in January at 43 hours, which was 1.4 hours longer than the U. S. average. But the average manufacturing wage in Tennessee in January at $ 19.51 an hour was still $ 1.19 per hour less than the U. S. average.