Labor shortage, housing continues to be focus in December “ECO” report

By Kailyn Lamb, Marketing Content Writer and Editor, PYA

The Knoxville Chamber released its December “Economic Conditions Outlook” (ECO) report last week. The report, which is powered by First Horizon Bank, continued to focus on the labor market and how shortages are impacting local businesses.

In December, businesses in the manufacturing and service sectors reported that general business activity and the outlook for the next six months are “the same.” Additional comments from manufacturing businesses indicated that supply chain issues are persisting, and some do not expect improvements until this summer. Service industry businesses also commented that they are not receiving enough inventory on a timely basis. Retail businesses, on the other hand, reported general business activity as “improved” with company outlooks as “the same.”

The Knoxville Metropolitan Statistical Area (MSA) had an unemployment rate of 2.6 percent in November, a slight decrease from the month before. The labor force in the Knoxville MSA increased from 430,464 in October to 434,827 in November, a 1 percent increase. The number of unique job openings increased by 5.3 percent in November, to 44,935. This is an increase of 44.4 percent compared to November 2020.

Other important trends identified were:

  • Home sales in the Knoxville MSA increased 9.9 percent in November. There were more recorded sales (26,947) in November 2021 than in any other November on record. They were up 11.2 percent compared to November 2020. Sales in Knox County rose by 4.1 percent.
  • The median home sale price in the Knoxville MSA was $295,000 in November, which was an increase of 21.6 percent compared to 2020. In Knox County, the median sale price was $310,000, an increase of 19.2 percent from 2020. A total of 38 percent of homes sold for over asking price in November.
  • The number of active listings continues to decrease. They are down more than 25 percent since September 2021. In the Knoxville area, November inventory was down 27 percent compared to 2020 and nearly 50 percent from pre-pandemic levels. Half of the homes on the market were sold in six days or less.
  • The National Association of Realtors (NAR) released is “2022 Housing Market Hidden Gems” report. The Knoxville MSA was listed as one of 15 metros areas that experienced the most net migration gains. Knoxville was also number five on NAR’s “Top 10 Undervalued Metro Area Housing Markets in 2021.” The report noted that prices are outpacing the wage growth and that broadband access is relatively low. The Chamber is aiming to address the broadband issue with its eKnox Broadband Task Force. Learn more here.
  • The Knoxville MSA collected $110.54 million in states sales tax in November, while Knox County collected $71.47 million. Both were slight increases compared to November 2020. The “ECO” report said that the increases show consumer spending continues to be strong.
  • In November, 161 new business licenses were issued. This is up from November 2020, but down nearly 18 percent compared to 2019.

Read the full report here.

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