Experts expect TN economic growth to stabilize in 2024
The 2024 Economic Report to the Governor of the State of Tennessee, released by the University of Tennessee, Knoxville projects that the state’s inflation-adjusted GDP will grow by 3.3 percent in 2023 before slowing to just 1.8 percent growth in 2024.
The job market is expected to slow, consumer spending is expected to slow, and inflation is expected to rise (at a slower rate), yet experts at the Boyd Center for Business and Economic Research at the University of Tennessee, Knoxville’s Haslam College of Business said in their annual report to Governor Bill Lee that there’s no reason to fret about a recession.
“This is not a call for a recession, but rather a deceleration to a more stable growth trajectory, following two years of unsustainably strong economic growth,” said Larry Kessler, who is a Research Associate Professor at the Boyd Center. He believes the economy will stabilize.
Workforce and Wages
The report recapped the year of 2023, and detailed huge areas of growth in housing, the job market, people moving to Tennessee, and business growth. The most interesting data surrounded the job market. This graph details the growth of jobs (in thousands) from 2016 to 2023.
Interestingly, the report also shared the Tennessee counties that have the most income per capita. In the East Tennessee region, Loudon stands out as the wealthiest county at $67,088 per capita. By comparison, Williamson County is the most wealthy at $119,937 per capita, Knox County was recorded at $63,494, and more rural counties came in significantly lower. As an example, Morgan County recorded $36,95 income per capita.
Migration and Housing
By in large, people who are moving to Tennessee are coming from Florida and California. Those who are choosing to move out of Tennessee are primarily moving to Florida and Georgia, according to statistics collected by the U.S. Census Bureau. According to the report by the Boyd Center, nearly 90,000 people migrated to Tennessee in 2022. Far fewer people left the state than moved in. When you compare Tennessee’s migration to other states in the U.S., it is significant.
From 2021 to 2022, about 180,300 people migrated out of New York and moved to a different state or country. Similarly, 113,600 people moved out of California and 104,400 moved out of Illinois.
Texas and Florida saw the greatest amount of population growth, by far.
With so many people coming into the state of Tennessee, the listing price for homes has risen pretty dramatically over the past few years. In 2016 the media listing price in Tennessee was in the lower $200,000 range. By July of 2023, our state’s median listing price has risen to about $450,000, which is higher than the national median. Knoxville’s median home price is $475,000.
Unfortunately, the rental situation in Knoxville doesn’t offer much resolve.
The good news is Knox County is growing in promising ways compared to other counties in the state and region. From fiscal year 2019 to 2023, Knox County had 3,135 new business applicants. No other counties saw the same growth – except for Shelby and Davidson counties, which both amassed about 4,800 applicants.
A large number of new businesses in the state are retail businesses, followed by healthcare and social assistance, services, and accommodations. There were 11,779 professional, scientific and technical services that started or moved to Tennessee in 2021.
The details included in this annual report are used to help the governor make decisions in 2024. Since 1975, the Boyd Center has provided Tennessee’s governor with an annual economic report that includes an in-depth analysis of state and national trends and forecasts.