published Friday, June 17th, 2011

Area jobless rates above U.S. average

Unemployment remained above the national average across Tennessee and Georgia in May, and economists expect the jobless rate to remain at historically elevated levels for at least the next couple of years.

“We’ve hit a soft patch in where jobs are going, but I don’t see the economy contracting,” University of Tennessee economist Matt Murray said Thursday. “We expect steady job growth over time, but unemployment is going to remain fairly high for some time to come.”

More people coming back into the work force pushed up the jobless rate slightly in Tennessee to 9.7 percent in May, while Georgia’s unemployment rate remained unchanged at 9.8 percent.

Nationwide, the May jobless rate rose a tenth of a percent to 9.1 percent.

“It is not uncommon for the jobless rate to increase when an economy is improving,” said Karla Davis, Tennessee’s labor commissioner. “The rate can go up because workers are entering the labor force faster than the economy is creating jobs.”

In a new economic forecast, the Center for Business and Economic Research in Knoxville projects that Tennessee’s jobless rate will average 9.4 percent for all of 2011 and will average 8.7 percent in 2012.

In Georgia, Labor Commissioner Mark Butler said the state’s jobless rate has been trending down over the past six months, although the Peach State’s unemployment rate has remained above the U.S. average for more than three years.

“More businesses are slowly beginning to expand their work force, illustrating a gradual increase of confidence in the economy,” Butler said.

Nonetheless, Georgia had 28,300 fewer jobs last month than in May 2010, a drop of 0.7 percent in total jobs across the state over the past year.

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