Email |

Tri-Cities region loses 439 jobs in first quarter

Published May 7th, 2008 | 2 Comments

The Tri-Cities region lost more than 400 jobs in the first quarter this year, reflecting the downturn in the national economy.

According to the latest labor market report issued Wednesday by East Tennessee State University, the Tri-Cities lost 439 jobs in the quarter while the unemployment rate climbed 13.23 percent to 5.14 percent.

Kingsport lost 174 of those jobs, and its unemployment rate grew 10.18 percent to 4.83 percent.

Bristol lost 94 jobs in the first quarter, while its unemployment rate rose 6.95 percent to 4.86 percent.

And Johnson City gained 32 jobs, but its unemployment rate climbed a whopping 19.10 percent to 5.19 percent in the quarter.

ETSU economist Steb Hipple said the region’s employment trends shifted during the period. Job gains were reported in education and health, construction, leisure and hospitality, finance, and information services.

Job losses were reported in durable and nondurable manufacturing, professional and business services, wholesale trade, government, and transport and utilities.

And job levels remained stable in retail trade, mining and other services.

Nationwide, job levels remained virtually unchanged in the first quarter vs. the same period of 2007, following 21 consecutive quarters of job growth.

Meanwhile, the nation’s unemployment rate jumped 10.2 percent to 5.28 percent, representing the first double-digit increase since the 2001 recession.

Hipple said that technically, the nation is not in a recession, which is defined as two quarters of decline in real gross domestic product (GDP).

“Yet real GDP has not declined and has actually shown modest growth over the past six months. But the labor market does not seem to know this — employment is flat and unemployment is up,” Hipple said.

He said some analysts consider these conditions “growth recession” — where growth in output is so slow that the labor market deteriorates.

“In those industries and regions and families where those jobs have vanished, people definitely believe there is a recession. In the Tri-Cities we have seen our first small decline in employment,” Hipple said.

Looking at the positives, real GDP was up modestly in the first quarter on the national level, unemployment was down in April, and the stock market has regained more than half of its losses since the first of the year, Hipple said.

Meanwhile, the Federal Reserve cut interest rates again and the Internal Revenue Service is issuing tax stimulus payments to help boost the economy.

But on the negative side, Hipple said the growth in first quarter real GDP was due to an increase in inventories, but the actual sales of goods and services was down. Moreover, unemployment levels have been on the rise in the past 12 months.

Hipple said many analysts expect economic growth to gain speed in the second half of 2008, but some economists fear the true recession is just starting.

“In short, the national economy is not out of the woods yet,” Hipple said. “At a minimum we will probably see a further deterioration in the national labor market. In the region, labor market conditions will follow those national trends.”

He said the Tri-Cities’ “cushion” is the strong job growth it enjoyed in 2006 and 2007.

“We may lose some jobs in the growth recession, but we will remain at a higher overall level of economic activity,” he said.

The labor market report is based on the 2007 benchmark of the Current Population Survey, U.S. Department of Labor.

Discuss This Story

Be the first to comment: Sign In or Create Profile .

You can define a recession any way you want but if you're unemployed and can't afford to drive around to look for work because gas it almost $4 a gallon, then I'd say you might be in one.

Joe Allison | 5/8/2008 - 11:45 AM - ( Comment

Suggest Removal )

The Fed has been desperately trying to prop up a broken system. The interest rate cuts have only been used to shore up balance sheets of financial institutions. Interest rates that are paid by consumers have actually risen during the time of these rate cuts. In other words, things are much more desperate for our economy than it seems to most people. But Mr Hipple never met a Republican policy he didn't like. I never have understood why he is considered such an authority. Jobs in this region have dried up, and if you find one it is a low paying one without benefits. Don't believe me? Just browse the classifieds in any regional newspaper. Compare it to the same paper from a few years ago. The numbers are telling.

Just my opinion.

wayne blake | 5/8/2008 - 10:16 AM - ( Comment

Suggest Removal )

To comment, you must register.

Comments are the sole responsibility of the registered user participating in online discussions. You agree not to post comments off topic, abusive, obscene, defamatory, vulgar, threatening or an invasion of privacy. Violators may be banned.

Click here to review our complete user agreement.