East Tennessee economy has largely rebounded from the Great Recession, according to King University study, but areas of concern remain

BRISTOL, Tenn. – The King Institute for Regional Economic Studies (KIRES) has released a new study. KIRES Report No. 19, "Local Labor Markets: Post-Recession Job Outlook and Links to the National Economy," was prepared by Dr. Alexander Brumlik and Dr. Sam Evans of the University's School of Business and Economics, along with King University seniors Faber Bickerstaffe, a native of London, England, who now calls Geneva, Switzerland, home, and Evan Harof of Williamsville, New York. Both students are Business majors with tracks in Economics.According to Brumlik, "December 2017 marked the 10-year anniversary of arguably the greatest economic crisis that most of us can recall – the "Great Recession" of 2007 – 2009. It seems fitting that we look back and critically analyze our regional economy. Local employment statistics are an important indicator of the current state of affairs. In this report, our focus is on the economic condition of East Tennessee, primarily in relation to jobs." The Great Recession began at the end of 2007 and lasted until the middle of 2009. According to the report, over that time period, East Tennessee lost around 21,700 manufacturing jobs, a decline of 22 percent. In addition, nearly 20,800 non-manufacturing jobs were shed, a loss of 4 percent. All told, 42,500 jobs were lost, 7.1 percent of the pre-recession job total.Evans points out, "Since the end of the recession the East Tennessee economy has added 43,300 jobs in the non-manufacturing sector, raising total jobs in this sector to 526,200. This surpasses the pre-recession total of 503,700 jobs."According to the report, gains in nonmanufacturing have been led by the Healthcare, Administrative, and Accommodation and Food Services sectors. Meanwhile, the Retail Trade sector, one of the largest sectors in terms of jobs, has struggled to reach the pre-recession jobs total.Haroff points out that manufacturing remains an area of concern. "Although manufacturing jobs have risen by 9,700 since the end of the recession to 81,800, they remain below the pre-recession level of 93,800." He adds, "Manufacturing plays an important role in economic growth because it has a high multiplier effect. For example, nationally for every dollar spent in manufacturing, another $1.81 is added to the economy, and each manufacturing job supports 1 to 2 jobs in other sectors of the economy, depending on the type of manufacturing and its geographic location."Another concern, according to Bickerstaffe, is the decline in the East Tennessee labor force: "The region's labor force – the sum of persons who are employed and those who are unemployed but actively seeking work – is around 734,000, below the pre-recession level of nearly 756,000. By way of contrast, the Tennessee labor force, excluding East Tennessee, is 4.8 percent above the pre-recession level." He adds, "A full examination of the root causes of our shrinking labor force is outside the scope of our study. However, we can infer that the clearest cause is the 'graying' of the population. Another more troubling cause is that many people may have given up looking for work."The authors note that for the study East Tennessee is divided into five geographic sub-regions. These sub-regions are the Kingsport-Bristol (TN) metro area, which consists of Hawkins and Sullivan counties; the Johnson City metro area, which consists of the counties of Carter, Unicoi, and Washington; Greene County; the Morristown metro area, which consists of the counties of Grainger, Hamblen, and Jefferson; and the Knoxville metro area, which consists of the counties of Anderson, Blount, Knox, Loudon, and Union. Harof adds "we explore the number of jobs in each of these sub-regions as well as the count of jobs by sector to determine if there has been significant job growth/loss since the end of the recession."The authors relied on the Quarterly Workforce Indicators (QWI) published online by the U.S. Census Bureau to examine changes in employment by economic sector. According to Brumlik, "the employment count in the QWI is a count of jobs, not the number of employed persons, and the data are reported with about a one-year lag (latest data are for Q1 2017)." Evans notes "the QWI counts are not seasonally adjusted, so we looked at the changes in employment for the same calendar quarter: Q3 2007, pre-recession; Q3 2009, the recession's end; and Q3 2016, post-recession."KIRES Report No. 19, "Local Labor Markets: Post-Recession Job Outlook and Links to the National Economy," and the 18 previous reports are available electronically at http://kires.king.edu.