KNOXVILLE — Tennessee-s economy has grown for nine straight years, and the annual Economic Report to the Governor says there-s no end to the expansion in sight.
The report, compiled by the University of Tennessee-s Center for Business and Economic Research, says both short- and long-term forecasts are bright.
Tennessee should outpace the nation in many segments of the economy through 2008, the report says.
Low unemployment and worker productivity are strengths of the state economy, said Dr. Matthew Murray, the UT economist who directed the report.
Tennessee-s growth has slowed in some areas compared to the nation, but Murray said this is no cause for concern.
“The state-s economy remains on a solid foundation, and the current level of economic activity is exceptionally high. There are more jobs today in Tennessee than ever in its history, and these jobs are increasingly of very high quality,” the report says.
When complete figures for 1999 are in, Tennessee-s unemployment rate is expected to be a half percentage point below the nation-s, which the report calls a “significant margin.”
Nonagricultural job growth in 1999 is expected to be down nearly 1 percent – 1.2 percent from 2.1 percent in 1998, but more than 32,000 new jobs were created last year. Nonagricultural jobs are estimated to total 2.7 million, the highest in Tennessee-s history, the report says.
Construction jobs are strong, Murray said, offsetting losses in manufacturing and non-durable goods such as textiles, apparel and leather goods.
Despite the non-durable losses, the report says output has not fallen to the same extent.
“This reflects important improvement in productivity that will help make the remaining jobs and firms in this broad sector more competitive in the global economy,- the document says.
“The state continues to shed its historically labor-intensive, low-wage jobs, replacing them with jobs that offer better compensation and potentially greater long-term security.”
The dramatic loss of non-durable jobs in the last decade has been dramatic and will continue. In 1990, textiles, apparel and leather accounted for 94,000 jobs. This year the number is expected to be no more than 44,500, the report says.
Automobile sales by dealers this year are estimated to be only about half of 1999-s total, leading a drop in taxable sales. Transportation, communications, public utilities sales see some growth, as will durable goods, the report says.
From 1999 to 2008, Tennessee should outpace the nation in gross product growth, 3.5 percent to 3 percent, the report says. Per capita personal income should increase 27 percent, to $29,850, it says.
The Tennessee departments of Economic and Community Development, Revenue and Labor and Workforce Development co-sponsor the Economic Report to the Governor.