By Will McDermott
What the locals say
Tennesseans are getting back to work.
The big story of the Tennessee economy is job growth. This state of only
6 million people has gained more than 100,000 jobs in the last two years.
Estimates published by the Tennessee Department of Economic and Community Development (ECD) put nonfarm employment at 2.91 million as of
September 2015. The U.S. Bureau of Labor statistics estimates that 3.01 million Tennesseans were employed in nonfarm jobs as of this past May.
Nonfarm employment in the state increased by 2.4 percent in 2016, according to an annual report published by the Boyd Center for Business and Economic Research, about a third higher than the 1.8 percent national increase.
Although the trade, transportation and utilities sector employs the most
Tennesseans (about 1 in 5 nonfarm jobs), much of the state’s recent gains
came from manufacturing jobs, which showed a 2.7 percent increase in
2016 — during a year when manufacturing jobs actually decreased across
A lot of these new jobs are coming from new businesses opening in — and
coming to — Tennessee. Business filings have been on a steep upward trend in
the state since 2012. In the 12 months leading up to this past March, Tennessee
registered more than 36,000 new business filings, according to a Boyd Center
quarterly report published this past April. The report states that 259,282 business entities were active in the state as of April 1, 2017, a 5.2 percent increase
year over year. In the first quarter of this year alone, Tennessee recorded 10,372
new filings, 8. 7 percent higher than the first-quarter filings from 2016.
New businesses and more jobs should equate to income increases in the state.
Tennessee ECD data show, however, that the state’s per capita personal income only increased by 1.2 percent year over year as of second-quarter 2016.
In fact, the Boyd Center annual report reveals that the state’s per capita
income in 2016 was 14. 4 percentage points below the national average.
Only two counties in the state had per capita incomes above the national
average: Davidson and Williamson.
Tennessee’s income woes may be related to the state’s low educational-attainment levels. As of 2015, only 85. 5 percent of Tennesseans had a high
school diploma, according to the Boyd Center annual report, a full 1.2 percentage points below the national average. The number of residents with a
bachelor’s degree or higher was just 24. 9 percent, compared to a 29. 8 percent
A recent state initiative — Drive to 55 — hopes to remedy these low numbers by setting a goal of having at least 55 percent of Tennesseans with
bachelor’s degrees by 2025. Tennessee Promise, another new initiative, offers tuition-free access to community and technical colleges for two years to
all Tennessee high school graduates. n
Home sales and prices
The annual number of homes sold in Tennessee dropped significantly
after the housing crisis, but median sale prices did not, according to data
from the Tennessee Housing Development Agency. More than 100,000
Tennessee homes sold in 2006, but by 2009 that number had been cut in
half. Interestingly, annual median home-sales prices only declined once
in the past 10 years, dropping just 2.3 percent in 2009. Tennessee home
prices have risen ever since and closed sales reached 2007 levels in 2015.
The Nashville area is posting record sales numbers this year. The 11, 155
closings posted in the second quarter of 2017 was the highest on record,
according to the Greater Nashville Association of Realtors, just edging
out the previous record of 11,046 closings in second-quarter 2016. Inventory in the Nashville area as of this past June was more than 10 percent
lower than the previous June, however.
Tennessee Home Sales*
Source: Tennessee Housing Development Agency
Home sales closed Median sales price
*Most current public information on Tennessee housing sales available
Chief operating officer and chief financial officer,
“Our biggest issue is inventory. I think it’s that way with a number
of markets. In the middle and lower price ranges, you’re looking at
almost every single listing getting multiple offers — some up to
20 at a time. Realtors aren’t even showing the homes one person
by one person. They’re waiting for an open house, having an influx
of people coming in, and then accepting multiple offers that day.
We’ve got stacks and stacks of pre-approved buyers that just can’t
find a home and make an offer fast enough.”