Jobless rate shrinks to 7-year low as labor market tightens

Dalton unemployment

In 23 years of recruiting workers for hundreds of employers across Southeast Tennessee and Northwest Georgia, Manpower franchise owner Mark Campbell says he's never before had so much trouble getting enough qualified workers.

"We're doing all the recruiting we can, but it's very difficult right now to get enough of the right people for all of the available jobs," said Campbell, who operates Manpower offices in Chattanooga; Cleveland, Tenn., and Dalton, Ga. "A lot of jobs are coming back as the economy improves, and with more people already employed, we're not seeing as many people coming in with the skills we need to fill all these jobs."

The jobless rate fell last month to the lowest level in seven years in metro Chattanooga, Cleveland and Dalton, according to figures released Thursday by the Tennessee Department of Labor and Workforce Development and the Georgia Department of Labor.

Although the region hasn't regained all of the more than 30,000 jobs lost in the Great Recession from 2008 to 2010, employers in the three metro areas have added more than 9,000 jobs in just the past year -- the fastest growth in more than a decade.

Unemployment in the six-county Chattanooga metro area fell last month to 5.2 percent -- the lowest rate since April 2008 and half the 10.2 percent peak reached in June 2009.

Employment reached a new high last month in nearby Cleveland, cutting the jobless rate to 5.1 percent, or less than half the peak 10.6 percent reached in March 2009.

The drop in joblessness was even more pronounced in Dalton. The self-proclaimed Carpet Capital of the World was one of the hardest-hit metro areas in the nation during the recession, shedding more than one of every five jobs in the recession and its aftermath.

But figures show Dalton's employment rose 3.5 percent, or 2,300 jobs, in the past year, giving the metro area an April unemployment rate of 6.7 percent. That's still well above the U.S. rate of 5.4 percent, but only a fraction of the 14 percent peak in March of 2009.

Partly because aging baby boomers are retiring, and partly because people who lost jobs during the recession don't have current job skills, employers in high-demand fields are struggling to fill open positions.

"We would be able to seat an additional 400 to 500 trucks if the people were there," said Eric Fuller, chief operating officer for Chattanooga-based U.S. Xpress, one of the nation's biggest trucking firms.

At Covenant Transport, recruiting vice president Rob Hatchett is trying to encourage more people to get behind the wheel with higher wages and better working conditions.

Jorge Morales, 23, and Karina Ross, 20, join hundreds of other hopefuls at the Northwest Georgia Trade and Convention Center in Dalton, Ga., to apply for new jobs in this file photo.

"We sit around and talk and we think about getting new people into the business," Hatchett said.

Campbell said the tightening job market is beginning to bid up wages. One Cleveland employer recently boosted its starting wage from $8 an hour to $10, he said.

Nonetheless, the average manufacturing wage in Tennessee, $17.46 an hour, remained 12 percent below the U.S. average last month of $19.78 per hour, according to BLS data.

Many employers paying far lower wages report that they are still able to recruit and fill available jobs.

The world's largest Internet retailer, Amazon, is filling hundreds of jobs at fulfillment facilities in Chattanooga and nearby Calhoun, Tenn., which typically start at $10 to $11 an hour. Spokeswoman Nina Lindsey said the company is "absolutely happy" with the quality of the Chattanooga-area workforce.

Lindsey said Amazon's Chattanooga workforce is now more than 3,000 after creating more than 900 full-time jobs since March.

"There are still some positions available," she said, adding people can visit www.workatamazonfulfillment.com to learn more and apply online.

New jobs are also being added at Volkswagen and its suppliers. A new sport utility vehicle to be built in Chattanooga will add 2,000 jobs to VW's assembly plant and new engineering facility, and generate another 7,800 spinoff jobs, according to a new University of Tennessee economic forecast.

Dr. William Fox, whose Center for Business & Economic Research in Knoxville prepared that forecast, said VW's new engineering and planning center will potentially need some outside personnel to fill all 200 slots.

"What you want is top people coming from around the country and around the world," he said. "In the end, that will make us all better, and they'll be Chattanoogans when they live and work here."

Over the past year, Hamilton County employers added 5,850 jobs, according to Thursday's jobs report.

Across Tennessee, Davidson County had the state's lowest major metropolitan rate in April at 4.1 percent, down from 4.4 percent in March. Knox County was at 4.3 percent in April, down from 4.6. Shelby County had the highest April jobless rate at 6.2 percent, down from 6.7 percent the previous month.

Tennessee's preliminary unemployment rate for April was 6 percent, down from the March revised rate of 6.3 percent. The U.S. preliminary rate for April was 5.4 percent, one-tenth of one percentage point lower than the prior month.

Among Georgia's 14 metropolitan cities, the jobless rate was lowest in Gainesville, at 4.7 percent, and highest in Albany at 6.9 percent.

Reporters Mike Pare and Alex Green contributed to this report.

Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340.