Tri-Cities job creation continues, but it’s slowing down; private sector wages continue making gains

Tri-Cities job creation increased for the 17th straight month in October. While that’s welcome news, don’t overlook the trend.

October’s growth rate continued a seven-month slowing, and the three-month moving average dropped below 1% for the first time this year in October.


Tri-Cities job creation continues but the growth rate is trending lower. Until October the employment growth rate was trending higher. The rule of thumb is when the employment and jobs numbers aren’t telling the same story go with the jobs numbers. CLICKING ON THE CHART RENDERS A LARGER VERSION

That begs the question: Are we near a new normal? In October, the pointer was in the “yes” column, but the presidential election injected a new unknown with President-elect Trump’s and the GOP’s plans to give economic growth a booster shot. Expect a boost in growth, a bump in inflation, higher interest rates, and volatile markets. All the while the local labor market is getting tighter and “now hiring” signs are abundant. The rub is the quality of many of those jobs and a labor force to meet what businesses want and need on a wide variety of levels.

Preliminary, non-adjusted Bureau of Labor Statistics numbers from the payroll survey show there were 900 more nonfarm jobs than October last year. But the growth is not distributed evenly.  The three-county Johnson City Metropolitan Statistical Area outperformed Kingsport-Bristol for the second straight month.

There were 800 more jobs last month in the Johnson City MSA and 100 more in Kingsport-Bristol. The trend line puts Johnson City’s growth rate about a point higher than Kingsport-Bristol.

The average Tri-Cities weekly private sector wage was also higher in October. And, Johnson City’s growth rate outperformed Kingsport-Bristol for the 8th straight month. But Johnson City wages still have not recovered from the 36-month decline that began in 2012 and ended spring last year. During that period wages in Kingsport-Bristol made slow gains. The combined effect of slow growth in Kingsport-Bristol and contraction in Johnson City moved Kingsport-Bristol into the top wage spot for the Tri-Cities.

However, the current growth hasn’t improved the region’s or either MSAs’ statewide wage standing.  Johnson City had the second lowest weekly wage in October while Kingsport-Bristol was the fourth lowest in the state. Both Tri-Cities MSAs lag the Knoxville weekly average by more than $250 a week. Knoxville has the highest weekly average wage in the state. The other NE Tenn. MSA – Morristown – was fifth – almost a $100 a week higher than Kingsport-Bristol.

The least reliable local monthly labor market indicator –  employment and unemployment rate from Household Survey – were also favorable in October. The unemployment rate was down 0.1% in the region, 0.2% in the Johnson City MSA and flat in Kingsport-Bristol.


Private sector wages in both Tri-Cities MSAs are increasing. They are increasing faster in the Johnson City MSA following a protracted decline. CLICKING ON THE CHART RENDERS A LARGER VERSION.

Dr. William Fox, UT economics professor and director of the Boyd Center for Business & Economics Research, told the audience this month at a State Data Center conference everyone would be better off if they stopped paying so much attention to the unemployment rate and focus on wages and job growth. It’s a message heard more and more often. Dr. Steb Hipple at ETSU has offered similar advice. In one of his local labor market commentaries he once called the unemployment rate the most worthless piece of data developed by the federal government – especially at the local level.

With that said, the 5.4% October Tri-Cities unemployment rate is about a point higher than what as the norm before the recession. And it could be the new normal. A rapidly aging population is a big factor. It has cut the area labor participation force to new lows. According to 2015 Census data, 54.3% of Tri-Cities men age 18 and over are in the labor force. For women, the rate is 50.5%. In 2005 60.8% of area men and 54.3% of women were in the labor force

Here’s a capsule view October’s year-over-year changes for jobs and unemployment and the unemployment rates for the region, MSAs and major cities.


Nonfarm jobs, up 0.4% from October last year.

Unemployment rate 5.4%, down 0.1%.

Employment, up 2.4% from last year.


Nonfarm jobs, up 1%

Unemployment rate 5.3%, down 0.2%

Employment, up 3.8%

Avg. weekly private sector wage $631, up 4.3%.


Nonfarm jobs, up 0.1%

Unemployment rate 5.3%,  unchanged

Employment, up 1.5%

Avg. weekly private sector wage, $667, up 3%.


Employment, up 3.7%.

Unemployment rate 5.8%, down 0.3%


Employment, up 3.8%

Unemployment rate 4.9, down 0.1%


Employment, up 2.7%

Unemployment rate 5.6%, down 0.2%.