By Kailyn Lamb, Marketing Content Writer and Editor, PYA
February’s “Economic Conditions Outlook” (ECO), which is financed by First Horizon Bank, reported on its usual industries such as retail, manufacturing, jobs, and housing, but this month’s edition also featured surveys on Paycheck Protection Program loans (PPP) and job predictions for a post-COVID world.
In manufacturing, businesses were split on general business activity as “improved,” or “worsened.” In the retail and service industries, businesses reported general activity as “the same.” Labor rates are expected to increase in the service industry, according to the report, which also said that some unskilled applicants are already expecting $15 per hour.
In this month’s edition, the Knoxville Chamber also asked businesses if they planned to apply to the second round of PPP loans. Around 78 percent said they did not plan to apply. Of the surveyed manufacturing businesses, none said they planned to apply. Half of that group said it was because payback requirements were unfavorable with the other half saying they did not need funding. Half of the retail businesses said they would apply. Those that are not applying said they did not need funding. In service, 82 percent are not planning to apply. Of those, 44 percent said they do not need the funding, and 33 percent saying they do not qualify. The remaining businesses said the payback requirements were not favorable.
Other important trends identified were:
- There were 33,641 unique job postings in the Knoxville area in January. This was a 5.3 percent increase from December. Postings were also up 11.3 percent compared to last January.
- The ECO highlighted another report, “The Future of Work After COVID-19,” which was released by McKinsey Global Institute. The McKinsey report indicates that by 2030 jobs for health and other Science, Technology, Engineering, and Mathematics related fields will increase between 0.1 percent and 2.7 percent. It predicts that the future lies in a “brain-powered economy.” The report aligns with the Knoxville Chamber’s “Path to Prosperity” strategic vision, but it also means that many people will likely have to transition to a new career.
- January saw a seasonal decline in home sales in the Knoxville area from December to January of 24.6 percent but are up 22% compared to last year. Active listings in the Knoxville area are down 46.7 percent compared to 2020. The median price for a home was $239,075 in January.
- Knox County collected $73.4 million in state sales tax in January. This was up 23.3 percent from December and up 4 percent compared to last year.
- A total of 361 new business licenses were issued in January, which was down from the 532 licenses issued last year.
The report also gave some information from the University of Tennessee Boyd Center for Business and Economic Research. The center recently conducted its “Tennessee Business Leaders Survey,” where three-quarters of those surveyed from East Tennessee expect the state’s economy to be better than the national economy for the next 12 months. In order to improve business climate, statewide leaders said technology infrastructure, city infrastructure, business development incentives, energy infrastructure, and business income tax reform should be prioritized.