Chattanooga unemployment drops to record low

·4 min read

Dec. 23—Unemployment in the Chattanooga area fell to an all-time low last month as the economy continued to rebound with some workers still reluctant to return to work amid the ongoing pandemic.

The jobless rate in the six-county Chattanooga metro area fell another two-tenths of a percentage point to 2.7% last month, the lowest level since the Bureau of Labor Statistics has kept such records over the past three decades. Chattanooga area employers added another 2,656 jobs during November, bringing employment to within 0.2% of Chattanooga's all-time employment peak reached in December 2019 just before the coronavirus pandemic began to slow the economy.

From Chattanooga's peak unemployment level of 14.1% reached in April 2020, employers in metro Chattanooga have added back more than 50,000 jobs in the past 19 months.

"There has been an enormous improvement in the job market since the start of the pandemic," said Bill Fox, director of the Boyd Center for Business and Economic Research at the University of Tennessee. "But in terms of getting our employment levels back to the pre-pandemic level, we still have a ways to go. We've had a lot of people drop out of the workforce, particularly retirees and women with children. When you have people drop out of the labor force when the economy is expanding you are going to get very low unemployment rates, and we're seeing that now."

Chattanooga ended 2019 with a jobless rate at 3.4%, or seven-tenths of a percent higher than last month's jobless rate, even though there were 577 more people on the job then than were working locally last month.

Although the labor force has shrunk slightly in Chattanooga, the decline has been less than in most of the state, and Chattanooga's recovery has been stronger than Tennessee as a whole, which reported a non-seasonally adjusted jobless rate in November of 3.1%.

Unemployment remained the lowest in the Chattanooga region in three counties in Northwest Georgia, which are a part of metro Chattanooga. Unemployment in Catoosa, Dade and Walker counties averaged 1.7% in November, down a tenth of a percent from the previous month.

Unemployment averaged 2.9% in metro Cleveland, Tennessee, and 2.2% in metro Dalton, Georgia, also a record low for the Carpet Capital.

Employment has bounced back strongly in Dalton, where the floorcovering industry is based, due to gains in new construction and remodeling activity.

Across Tennessee, the state Department of Labor and Workforce Development reported Thursday that unemployment declined in 85 counties, was unchanged in five counties and rose in five of the state's 95 counties — none of which were in Southeast Tennessee.

Williamson County continued to have the state's lowest level of unemployment at 2.1%, while the jobless rate was highest in Tennessee last month in Perry County, at 5.1%.

"Unemployment rates are at historic lows in many counties, but you have to remember that some of these low rates are due to fewer people in the labor force," said Murat Arik, director of the Business and Economic Research Center at the Jones College of Business at Middle Tennessee State University. "Labor force participation in many counties is not improving much, even with more jobs being available."

Fox predicts unemployment rates will likely fall still farther and employers may be challenged in hiring more workers for some time. The U.S. Bureau of Census reported this week that an aging population amid the pandemic produced more deaths than births in Tennessee last year for the first time in modern history, and all of the state's growth is coming from the migration of people moving to the Volunteer State from other locations.

"The uncertainties about this pandemic continue, and I think we're likely to see some people reluctant to enter the labor force while the virus is still seen as a threat," Arik said.

To help recruit workers to Chattanooga and aid local workers trying to find the right job, the Chattanooga Area Chamber of Commerce launched Chattanooga Calling a year ago. On Thursday, the Chattanooga Calling website listed 25,367 open jobs, or more than three times as many jobs as the 7,408 Chattanooga area residents counted as unemployed and looking for work last month.

Statewide, the Tennessee career centers have listings for 417,812 available jobs, or four times as many jobs as the number of unemployed counted in Tennessee last month. Not all the jobs listed in such databases match the skills and career expectations of those seeking work.

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

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