ETSU Bureau of Business and Economic Research

 

Tri-Cities Labor Market Report

 

East Tennessee State University + Third Quarter 2015 + College of Business and Technology

 

THE METROPOLITAN AREA (CSA)

 

               The third quarter labor market performance in the Tri-Cities was the second best in several years, following the second quarter performance which was the best in several years.  Based on household data from the Current Population Survey (CPS), regional employment grew 1.8% over the summer months.  The companion payroll data from Current Employment Survey (CES) puts the metro employment growth at 1.1%.  The second and third quarters simply represent the best regional labor market conditions since the Great Recession of 2008-09.

               According to the Current Population Survey, metro employment levels increased 1.8% to 214,790.  Unemployment fell 14.1% to 13,827, reducing the jobless rate to 6.1% (compared to 7.1% in 2014 and 7.7% in 2013).  The overall labor force expanded by 0.8% to 228,616.  The Current Employment Survey shows payroll employment rising to 202,267, or 1.1% above 2014 levels.

               Among the twelve regional NAICS industry sectors covered by the CES, employment levels were higher in seven, lower in one, and unchanged in four (compared to higher in seven, lower in three, and unchanged in two sectors in the second quarter).  Job growth was led by leisure & hospitality, retail trade, and education & health services.  Smaller job gains were reported by wholesale trade, transport & utilities, and government.  Job declines were limited to information services.  Employment was unchanged in manufacturing, financial services, construction, and other services.

 

                  Labor Force      Employment           Unemployment
        Period    Level  Y-Y%Ch    Level  Y-Y%Ch    Level  Y-Y%Ch   Rate_
         2007    244,704   0.45   234,109   0.92    10,595  -8.87   4.33
         2008    247,668   1.21   233,447  -0.28    14,222  34.22   5.74
         2009    247,965   0.12   224,752  -3.72    23,213  63.22   9.36
         2010    239,478  -3.42   217,213  -3.35    22,265  -4.08   9.30
         2011    242,277   1.17   221,769   2.10    20,509  -7.89   8.47
         2012    237,986  -1.77   219,844  -0.87    18,142 -11.54   7.62
         2013    233,616  -1.84   215,816  -1.83    17,799  -1.89   7.62
         2014    227,230  -2.73   212,077  -1.73    15,153 -14.87   6.67
         12:1    238,808  -1.07   219,952   0.34    18,857 -14.93   7.90
         12:2    239,040  -1.72   220,730  -0.69    18,310 -12.68   7.66
         12:3    237,329  -2.21   218,873  -1.38    18,456 -11.01   7.78
         12:4    236,765  -2.09   219,821  -1.71    16,944  -6.70   7.16
         13:1    235,861  -1.23   216,809  -1.43    19,052   1.04   8.08
         13:2    235,740  -1.38   217,425  -1.50    18,315   0.03   7.77
         13:3    233,332  -1.68   215,427  -1.57    17,906  -2.98   7.67
         13:4    229,529  -3.06   213,604  -2.83    15,925  -6.01   6.94
         14:1    228,911  -2.95   213,204  -1.66    15,707 -17.56   6.86
         14:2    228,113  -3.24   213,153  -1.97    14,960 -18.32   6.56
         14:3    227,096  -2.67   210,994  -2.06    16,102 -10.07   7.09
         14:4    224,799  -2.06   210,957  -1.24    13,842 -13.08   6.16
         15:1    228,032  -0.38   213,454   0.12    14,578  -7.19   6.39
         15:2    232,449   1.90   218,872   2.68    13,577  -9.25   5.84
         15:3    228,616   0.67   214,790   1.80    13,827 -14.13   6.05

 

THE TRI-CITIES

 

               Matching the regional performance, all three cities continued to enjoy the best labor market conditions in years.  During the summer months, employment grew 2.3% in Johnson City, 2.0% in Kingsport, and 1.2% in Bristol.  Unemployment fell by double digits in each city, reducing the unemployment rate to 5.6% in Bristol, 6.2% in Kingsport, and 6.3% in Kingsport.

 

 

Bristol TN-VA Urbanized Area Labor Market

 
                  Labor Force      Employment           Unemployment
        Period    Level  Y-Y%Ch    Level  Y-Y%Ch    Level  Y-Y%Ch   Rate_
         2007     32,481   0.22    31,055   0.38     1,426  -3.03   4.39
         2008     32,960   1.48    31,205   0.48     1,755  23.10   5.32
         2009     32,931  -0.09    29,962  -3.99     2,969  69.19   9.02
         2010     32,590  -1.03    29,745  -0.72     2,845  -4.19   8.73
         2011     33,114   1.61    30,461   2.41     2,653  -6.75   8.01
         2012     32,638  -1.44    30,263  -0.65     2,375 -10.49   7.28
         2013     32,178  -1.41    29,882  -1.26     2,296  -3.29   7.14
         2014     31,682  -1.54    29,663  -0.73     2,019 -12.09   6.37
         12:1     32,742  -0.15    30,231   0.68     2,511  -9.24   7.67
         12:2     32,782  -1.24    30,393  -0.54     2,389  -9.34   7.29
         12:3     32,607  -2.05    30,188  -1.17     2,419 -11.82   7.42
         12:4     32,420  -2.30    30,241  -1.55     2,179 -11.63   6.72
         13:1     32,310  -1.32    29,885  -1.14     2,425  -3.43   7.50
         13:2     32,422  -1.10    30,089  -1.00     2,333  -2.34   7.20
         13:3     32,210  -1.22    29,904  -0.94     2,306  -4.69   7.16
         13:4     31,771  -2.00    29,649  -1.96     2,122  -2.61   6.68
         14:1     31,896  -1.28    29,785  -0.33     2,110 -12.97   6.62
         14:2     31,829  -1.83    29,804  -0.95     2,025 -13.21   6.36
         14:3     31,684  -1.63    29,549  -1.19     2,135  -7.39   6.74
         14:4     31,319  -1.42    29,514  -0.45     1,805 -14.95   5.76
         15:1     31,679  -0.68    29,777  -0.03     1,902  -9.88   6.00
         15:2     32,110   0.88    30,818   1.72     1,792 -11.48   5.58
         15:3     31,652  -0.10    29,891   1.16     1,761 -17.51   5.56
 

 

Johnson City Urbanized Area Labor Market

 
                  Labor Force      Employment           Unemployment
        Period    Level  Y-Y%Ch    Level  Y-Y%Ch    Level  Y-Y%Ch   Rate_
         2007     60,977   1.53    58,372   1.96     2,605  -7.22   4.27
         2008     61,391   0.68    57,761  -1.05     3,629  39.30   5.91
         2009     61,505   0.19    55,868  -3.28     5,637  55.32   9.17
         2010     58,250  -5.29    52,830  -5.44     5,419  -3.86   9.30
         2011     58,792   0.93    53,777   1.79     5,015  -7.46   8.53
         2012     57,709  -1.84    53,387  -0.73     4,322 -13.82   7.49
         2013     56,262  -2.51    51,959  -2.68     4,303  -0.43   7.65
         2014     54,351  -3.40    50,716  -2.39     3,635 -15.53   6.69
         12:1     57,992  -1.46    53,549   0.35     4,443 -19.05   7.66
         12:2     57,921  -1.74    53,533  -0.45     4,388 -15.21   7.58
         12:3     57,321  -2.32    52,903  -1.36     4,418 -12.50   7.71
         12:4     57,604  -1.85    53,565  -1.43     4,039  -7.10   7.01
         13:1     57,053  -1.62    52,468  -2.02     4,585   3.21   8.04
         13:2     56,784  -1.96    52,307  -2.29     4,477   2.02   7.88
         13:3     55,923  -2.44    51,563  -2.53     4,360  -1.32   7.80
         13:4     55,290  -4.02    51,498  -3.86     3,791  -6.13   6.86
         14:1     54,752  -4.03    51,069  -2.67     3,683 -19.67   6.73
         14:2     54,464  -4.08    50,889  -2.71     3,575 -20.14   6.56
         14:3     54,188  -3.10    50,268  -2.51     3,919 -10.10   7.23
         14:4     53,998  -2.34    50,637  -1.67     3,361 -11.34   6.23
         15:1     54,800   0.09    51,274   0.40     3,526  -4.28   6.43
         15:2     55,991   2.80    52,688   3.53     3,303  -7.61   5.90
         15:3     54,868   1.26    51,433   2.32     3,435 -12.36   6.26
 

 

Kingsport Urbanized Area Labor Market

 
                  Labor Force      Employment           Unemployment
        Period    Level  Y-Y%Ch    Level  Y-Y%Ch    Level  Y-Y%Ch   Rate_
         2007     50,171  -0.34    48,115   0.34     2,056 -14.07   4.10
         2008     50,734   1.12    47,916  -0.41     2,818  37.08   5.55
         2009     51,046   0.62    46,333  -3.30     4,713  67.27   9.23
         2010     49,718  -2.60    45,094  -2.67     4,624  -1.90   9.30
         2011     50,379   1.33    46,124   2.28     4,256  -7.97   8.45
         2012     49,339  -2.07    45,569  -1.20     3,770 -11.41   7.64
         2013     48,460  -1.78    44,745  -1.81     3,715  -1.46   7.67
         2014     46,888  -3.24    43,733  -2.26     3,156 -15.05   6.73
         12:1     49,408  -1.36    45,510   0.04     3,898 -15.17   7.89
         12:2     49,580  -2.11    45,758  -1.14     3,822 -12.40   7.71
         12:3     49,353  -2.43    45,501  -1.65     3,852 -10.74   7.81
         12:4     49,013  -2.37    45,506  -2.04     3,507  -6.43   7.16
         13:1     48,918  -0.99    44,974  -1.18     3,944   1.18   8.06
         13:2     48,984  -1.20    45,131  -1.37     3,853   0.79   7.87
         13:3     48,501  -1.73    44,751  -1.65     3,750  -2.65   7.73
         13:4     47,436  -3.22    44,124  -3.04     3,312  -5.55   6.98
         14:1     47,219  -3.47    43,997  -2.17     3,222 -18.31   6.82
         14:2     47,158  -3.73    44,037  -2.42     3,120 -19.01   6.62
         14:3     46,919  -3.26    43,548  -2.69     3,371 -10.12   7.18
         14:4     46,258  -2.48    43,348  -1.76     2,910 -12.14   6.29
         15:1     46,993  -0.48    43,970  -0.06     3,023  -6.18   6.43
         15:2     48,143   2.09    45,309   2.89     2,834  -9.19   5.89
         15:3     47,357   0.93    44,422   2.01     2,935 -12.93   6.20

 

THE UNITED STATES

 

               Labor market conditions continued to improve in the United States during the summer quarter.  Based on the CPS household survey, employment rose 1.6% to 149.3 million, while unemployment fell 15.4% to 8.2 million and the jobless rate declined to 5.2% (compared to 6.2% in 2014 and 7.4% in 2013).  Employment levels have been rising for the past twenty quarters, and during fifteen of the last sixteen quarters, the rate of job growth has been above the critical one percent threshold which is necessary to accommodate population expansion.  Over the past year, the national economy has seen the highest rate of job creation since the end of the 2008-09 Great Recession.

               The Current Employment Survey shows national payroll employment increasing by 2.0% to 142.2 million.  All twelve NAICS industry sectors in the CES again reported higher job levels during the third quarter.  The largest employment gains were in professional & business services, education & health, leisure & hospitality, and retail trade.  Smaller employment growth occurred in financial services, transportation & utilities, mining & construction, government, manufacturing, wholesale trade, other services, and information services.

 
                   Labor Force      Employment           Unemployment
         Period    Level  Y-Y%Ch    Level  Y-Y%Ch    Level  Y-Y%Ch   Rate_
          2007    153,124  1.12    146,047  1.12     7,078    1.10   4.62
          2008    154,287  0.76    145,362 -0.47     8,924   26.09   5.78
          2009    154,142 -0.09    139,878 -3.77    14,265   59.84   9.25
          2010    153,889 -0.16    139,064 -0.58    14,825    3.93   9.63
          2011    153,617 -0.18    139,869  0.58    13,747   -7.27   8.95
          2012    154,975  0.88    142,469  1.86    12,506   -9.03   8.07
          2013    155,389  0.27    143,929  1.02    11,460   -8.36   7.37
          2014    155,922  0.34    146,305  1.65     9,616  -16.09   6.17
          12:1    153,972  0.81    140,680  1.78    13,292   -8.42   8.63
          12:2    155,096  0.96    142,641  1.93    12,455   -9.01   8.03
          12:3    155,618  0.79    143,006  1.85    12,613   -9.82   8.10
          12:4    155,212  0.97    143,549  1.87    11,663   -8.90   7.51
          13:1    154,679  0.46    142,180  1.07    12,499   -5.97   8.08
          13:2    155,854  0.49    144,332  1.19    11,521   -7.50   7.39
          13:3    156,234  0.40    144,758  1.23    11,477   -9.01   7.35
          13:4    154,790 -0.27    144,447  0.63    10,343  -11.32   6.68
          14:1    155,012  0.22    144,250  1.46    10,762  -13.90   6.94
          14:2    155,895  0.03    146,423  1.45     9,472  -17.79   6.08
          14:3    156,636  0.26    146,951  1.52     9,685  -15.61   6.18
          14:4    156,144  0.87    147,597  2.18     8,547  -17.36   5.47
          15:1    156,193  0.76    147,102  1.98     9,092  -15.52   5.82
          15:2    157,518  1.04    149,194  1.89     8,325  -12.11   5.28
          15:3    157,508  0.56    149,310  1.61     8,198  -15.35   5.21
          Note: Data are in thousands.

 

ANALYSIS

 

               The favorable labor market trends of the second quarter continued into the third quarter.  All of the markets covered in this report again show higher employment, lower unemployment, and reduced jobless rates.  Overall, current labor market performance is the best since the Great Recession of 2008-09.

               At the national level, employment has increased for the past five years, and the rate of job creation shows no sign of a slowdown.  As a result, national employment has now surpassed the pre-recession peak by three million workers.  This is a very positive achievement.  However, due to population growth, some nine million workers still remain outside of the labor force.  If these are added to the unemployment totals, then the effective unemployment rate becomes 10.4%.  At the present employment growth rate, it will take six to seven years before the national economy returns to true full employment.

               In the regional Tri-Cities economy, the CPS and CES jobs data continue to be in sync and show strong employment growth.  As noted in previous reports, the CPS household jobs numbers showed declines from 2012 to 2014, while the CES establishment payroll figures showed growth.  Only the payroll employment data were consistent with the higher retail sales in the region.  And notably, the retail sector reported the second largest job growth in the third quarter.

               Looking ahead, the national economy is expected to continue its overall expansion above the rate of population growth.  This will slowly add the nine million missing workers back into the productive labor force and reduce the number of families on welfare.  The effect on government budget deficits could be significant.  The regional economy also has a good outlook.  The Tri-Cities area is now clearly plugged into the national expansion, and as long as the U.S. economy grows, our regional economy will prosper.  And higher local incomes will provide the basis for continued retail growth.

 

Data Sources.  This report is based on two monthly data surveys from the U.S. Bureau of Labor Statistics (BLS).  The data used for the labor market tables are based on the monthly survey of the homes where people live.  This survey is officially the Current Population Survey (CPS), but the term “household survey” is preferred by the BLS.  The CPS provides labor market information for the nation, states, counties, and cities.  The data used for employment by industry are based on the monthly survey of the places where people work.  This survey is officially the Current Employment Survey (CES), but the term “establishment survey” is preferred by the BLS.  This survey is also called the “payroll survey”.  The CES provides payroll employment data for the nation, states, and metropolitan areas.

 

Technical Note on the Tables.  This report was prepared in November 2015, and is based upon the 2014 benchmark of the Current Population Survey, U.S. Bureau of Labor Statistics (BLS).  The labor markets for Bristol, Johnson City, and Kingsport are presented in terms of the U.S. Census Bureau concept of the urbanized area (UZA) which includes the core city and the contiguous urban fringe.  The urbanized area for each city is based upon demographic patterns from the 2010 Census of Population.  The data in this report are not adjusted for seasonality, so comparisons should be made on a year-to-year basis.

 

More information.  This report was prepared by Dr. F. Steb Hipple, Professor of Economics, and Research Associate, BBER.  For more information, please contact Dr. Hipple c/o Department of Economics and Finance, Box 70686, East Tennessee State University, Johnson City, Tennessee 37614.  Phone/Voicemail: 423-439-5304.  Fax: 423-439-8583.  E-Mail: hipples@etsu.edu .  Website: http://faculty.etsu.edu/hipples.