February “ECO” report gives an update on Knoxville worker shortage
By Kailyn Lamb, Marketing Content Writer and Editor, PYA
Last week, the Knoxville Chamber released the February “Economic Conditions Outlook” (ECO) report, powered by First Horizon Bank. The focus of the latest report was on jobs as the Chamber surveyed business owners about their experiences at job fairs, in addition to its usual business inquiries.
Businesses in the manufacturing and service sectors reported general activity as “mixed” with future outlooks as “the same.” Retail, on the other hand, reported in February that general activity was split between “worsened” and “the same.” Retail business future outlooks were also reported as “the same.”
Additional retail comments from businesses in the retail sector said that increasing prices continue to negatively impact demand. However, boat sales have seen an increase in buyers moving in from other states. In the service sector, rising costs are also impacting business, along with continued uncertainty about COVID-19 and regulations around the pandemic.
For the manufacturing sector, comments revolved around recruiting and retaining employees. As larger firms have come into the area, recruiting has become more challenging for local manufacturing businesses with increased hiring and wage competition. Regarding hiring, the “ECO” report also surveyed businesses on job fairs for the February edition. Of the responses, 69 percent said they did not participate in job fairs. Reasons were varied and included that the business was fully staffed, did not see value in a job fair, did not enough staff to cover a job fair, or had concerns there would not be workers with the necessary skill set. Of those that did participate in job fairs, 60 percent reported a neutral experience, while the remaining 40 percent reported a positive experience. “Neutral” respondents said there were too many open positions with too few qualified candidates. Those that responded “positive” said they saw an increase in job applicants.
The February report did not include an update on the local labor force as the data will not be available until mid-March. In January, there were 9,957 unique job postings in the Knoxville MSA, a 4.7 percent decrease from December. In Knox County, there were 6,861 unique job postings, a decrease of 2.3 percent from December.
The Great Retirement and Great Resignation trends continue to plague the local workforce. There will be continued pressure on wages, sign-up bonuses, job flexibility, and childcare options, the report said. The Chamber stressed the importance of talent attraction and retention, particularly in the 25-54 age group. According to a recent study from Heartland Forward, Knoxville ranked #137 of 380 metropolitan areas in retaining college graduates. From 2010 to 2019, the number of adults with a college degree aged 25-54 and living in the Knoxville area went up only 1.1 percent. This is partially due to a “misalignment” in the degree programs that produce a high number of graduates and the number of jobs available in those fields.
Other important trends identified were:
- Home sales in the Knoxville area rose 7.6 percent in January compared to last month. Sales are also up 3 percent compared to January 2021. In Knox County sales increased 8.8 percent from December but were down 7.5 percent when compared to last year.
- The median home sale price for the Knoxville area and Knox County was $300,000, an increase of 25.1 percent and 20 percent from last year, respectively. Around 36 percent of homes sold for over asking price.
- Housing inventory in the Knoxville area is down 38 percent compared to last year.
- The Knoxville MSA collected $125.44 million in state sales tax in January, a double-digit increase when compared to both last month and January 2021. Knox County collected $82.93 million, which was also a double-digit increase from last month and 2021.
- In January, 422 new business licenses were issued in Knox County, an increase of 16.9 percent from 2021.
- The Metropolitan Knoxville Airport Authority recorded 185,605 passengers in December. This was a decrease of 6.7 percent compared to November traffic but was a whopping increase of 89.6 percent compared to December 2020 numbers during the pandemic. Numbers still have not entirely caught up to pre-pandemic levels, with this year still falling 13.3 percent short of December 2019 passenger numbers.
Find the full report here.