The region lost more than 2,300 jobs in the third quarter, and local unemployment rates spiked as the nation’s economic slump trickled down to the Tri-Cities.
According to the latest labor market report issued Monday by East Tennessee State University, the metropolitan area lost 2,341 jobs in the third quarter vs. the same time last year. Job losses were reported in professional and business services, government, durable and nondurable manufacturing, leisure and hospitality, wholesale trade, retail trade, transportation and utilities, and other services.
Job gains were reported in education and health, construction, information services, and finance.
Kingsport lost 543 jobs during the quarter, Johnson City lost 785 jobs, and Bristol lost 173 jobs.
Meanwhile, the region’s unemployment rate jumped a whopping 43.24 percent to 6.17 percent in the period.
Kingsport’s unemployment rate increased from 4.21 percent to 6 percent in the quarter; Johnson City’s jobless rate rose from 4.37 percent to 6.23 percent; and Bristol’s unemployment rate increased from 4.32 percent to 6.02 percent in the period.
ETSU economist Steb Hipple said employment in the region has declined over the past three quarters while inflation has worsened.
“All doubts are now removed — the U.S. economy is in a recession,” Hipple said.
He said the crisis began with the collapse of the housing market, which created a chain reaction throughout the financial sector.
“The collapse in the housing market since early 2007 has put downward pressure on the overall economy. But now the added problems and turmoil in the financial sector have triggered a full-blown recession,” Hipple said.
“Analysts believe we are facing the worst business cycle contraction in a generation.”
He said the recessions of 1990 and 1991 and 2001 were mild, while the last bad recession occurred in 1981 and 1982, when the unemployment rate jumped to more than 10 percent.
Hipple said the national economy is expected to continue to slump into the first part of 2009.
“Economic growth may resume in late 2009 or early 2010. The unemployment rate will continue to increase through this period. Labor market recovery will depend upon the timing of a strong recovery in the overall economy,” Hipple said.
The labor market report is available for viewing online at http://faculty.etsu.edu/hipples.