KNOXVILLE, Tenn. — Moderately strong economic growth is forecast for the state through 1999 by researchers at the University of Tennessee-Knoxville.
Dr. Matt Murray of the UT-Knoxville Center for Business and Economic Research said state economic trends show a continuation of growth similar to the past two years.
“The broad indicators of the state’s economic growth — personal income, jobs creation and unemployment — show we will do well through 1999,” Murray said.
Forecast highlights:
— Nominal personal income growth of 5.6 percent this year and next.
— An unemployment rate in the range of 4.9 percent this year and 5.2 percent next.
— Overall growth in jobs of 2.2 percent this year and 2.1 percent in 1999.
Murray said the growth in new jobs is possible despite an expected decline in non-durable goods manufacturing positions.
“The biggest weak spot in the state’s economy will be in non-durable goods (textiles, apparel and leather) manufacturing,” Murray said. “We’ll be shedding 5,000 to 6,000 jobs each year — most of them in non-durable goods manufacturing.”
Murray said the decline in non-durable goods manufacturing is consistent with a competitive world market that offers lower costs elsewhere.
The state’s service sector will be the fastest growing part of the state’s economy and the trade sector will do well, Murray said. They represent about 50 percent of all jobs in the state.
“The trade sector, which is approaching the size of the service sector in terms of jobs, is going to be enjoying growth of almost 3 percent the next couple of years,” Murray said.
Details are published in the latest issue of CBER’s “Business and Economic Forecast.”
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Contact: Dr. Matt Murray (423-974-5441)