Labor Market Information
Data note – due to the federal government shutdown, October 2025 data has been canceled. January and February data will be released in April 2026.
The Knoxville MSA’s unemployment rate in December was 2.9% (down from 3.4% in November and down from 3.2% in December 2024.) Knox County’s unemployment rate in December was 2.7% (down from 3.2% in November and down from 3.0% in December 2024.) Tennessee’s unemployment rate was 3.4% in December (down from 3.7% in November and down from 3.5% in last December.) The U.S. unemployment rate was 4.1% in December (down from 4.3% in November and up from 3.8% in last December.)
Knox County’s labor force slightly decreased 0.4% from 263,191 in November to 262,151 in December. The Knoxville MSA’s labor force slightly decreased 0.4% from 468,840 in November to 467,121 in December. Tennessee’s labor force slightly increased 0.1% from 3,523,576 in November to 3,527,850 in December. The national labor force slightly decreased 0.4% from 171,467,000 in November to 170,723,000 in December.
Below is the 13-month unemployment rates trending comparison for the four largest MSA’s in Tennessee –
Job Market
For the month of January, there were 8,994 unique new job postings in the Knoxville MSA (up 7.9% from December and down 10.1% from last January.) There were 5,587 unique new job postings in Knox County (up 7.9% from December and down 10.5% from this time last year.)
The Top 10 industries (by number of job postings) in the Knoxville MSA in January were –
The Top 10 occupations (by number of job postings) in the Knoxville MSA in January were –
You can view the 13-month job postings trend for Knox County and the Knoxville MSA below.
(Source: Lightcast – formerly Emsi Burning Glass)
ADP National Employment Report®
Each month, ADP, a large-scale payroll and human resources company, in collaboration with the Stanford Digital Economy Lab, releases the National Employment Report®, which provides a high-level look at month-over-month private-sector employment changes across the country.
The February report shows a net gain of 63,000 jobs in private-sector employment (up from the 22,000 net jobs gain in January). Industry sectors showing positive job growth in February include Education and Health Services (+58,000), Construction (+19,000), Information (+11,000), Other Services (+6,000), Financial Activities (+2,000), Natural Resources and Mining (+2,000), and Leisure and Hospitality (+1,000).
The industry sectors that showed job losses in February were Professional and Business Services (-30,000), Manufacturing (-5,000), and Trade/Transportation/Utilities (-1,000).
By establishment size, “Very Small” businesses (with 1-19 employees) gained 58,000 jobs, large businesses (with 500+ employees) gained 10,000 jobs, and “Other Small” businesses (with 20-49 employees) gained 2,000 jobs. Mid-sized businesses (with 250-499 employees) lost 4,000 jobs and mid-sized businesses (with 50-249 employees) lost 3,000 jobs.
(Source: ADP)
Intuit QuickBooks Small Business Index
Each month, Intuit QuickBooks, the accounting software provider for small and medium-sized businesses, releases the Small Business Index Report, which analyzes employment and revenue trends for small businesses in the U.S. with one to nine employees across twelve industry sectors.
In February, there were 12,626,500 people employed by U.S. small businesses with one to nine employees, down 45,300 from January. Jobs decreased in all twelve industry sectors tracked by the Index including Leisure and Hospitality (-11,300), Professional and Business Services (-6,900), Retail Trade (-6,900), Education and Health Services (-6,000), Manufacturing (-3,400), Construction (-3,100), Transportation and Warehousing (-2,300), Wholesale Trade (-1,900), Finance and Real Estate (-1,700), Information (-900), Agriculture/Natural Resources/Mining (-800), and Utilities (-200).
Below is the 13-month total employment trend for U.S. small businesses with one to nine employees –
Please note that all monthly small business employment estimates are subject to revision.
You can access the full report here.
(Source: Intuit QuickBooks)
Worker Shortage Update
The labor shortages are persisting longer than many economists expected. There continues to be high job demand and slower workforce growth resulting in fierce competition for talent and many open jobs going unfilled. According to the latest data from the U.S. Bureau of Labor Statistics (BLS), the nation had 6.9 million jobs to fill and only 5.3 million hires in January, leaving 1.6 million jobs unfilled.
In January, the largest increases in U.S. job openings were in financial activities (+169,000), health care and social assistance (+150,000), retail trade (+130,000), accommodation and food services (+98,000), manufacturing (+69,000), transportation/warehousing/utilities (+22,000), wholesale trade (+3,000), and information (+1,000).
The largest decreases in job openings were in professional and business services (-190,000), other services (-35,000), private educational services (-28,000), construction (-14,000), and arts/entertainment/recreation (-12,000).
It will take time for this mismatch between labor demand and supply to align. In the meantime, wages will continue to rise as businesses compete to attract talent. You can read the latest job openings summary from BLS here.
Consumer Price Index (CPI – Inflation Rates)
Data note: due to the federal government shutdown, October data has been canceled.
The national inflation rate from January 2025 to January 2026 is 2.4% (down from 2.7% in the December 2024 to December 2025 period. Last year, the national inflation rate was 3.0% from January 2024 to January 2025.
The January CPI report marks the 43rd straight month that year-over-year inflation is below the June 2022 CPI peak high of 9.1%. High prices for some items will likely linger longer.
From a year ago, natural gas prices are up 9.8%, electricity costs are up 6.3%, auto repair services are up 4.9%, eating out prices are up 4.0%, medical care services are up 3.9%, housing prices are up 3.0%, rent is up 2.8%, airline fares are up 2.2%, groceries are up 2.1%, apparel is up 1.7%, auto insurance is up 0.5%, and new vehicle prices are up 0.4%. From a year ago, gasoline prices are down 7.5% and used car prices are down 2.0%.
The Federal Reserve decided to maintain the target range of the federal funds rate at 3 ½ to 3 ¾ percent at its Federal Open Market Committee (FOMC) policy-setting meeting March 17-18. The Fed stated that “economic activity has been expanding at a solid pace. Job gains have remained low, and the unemployment rate has been little changed in recent months. Inflation remains somewhat elevated.” The committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. You can read more here.
Knoxville falls into the South Size Class B/C (population of 2.5 million or less) grouping. The current inflation rate for this region is 2.1% for the January 2025 to January 2026 period (down from 2.4% in the December 2024 to December 2025 period. Last year, the rate was 2.9% from January 2024 to January 2025.
(Source: U.S. Bureau of Labor Statistics; Consumer Price Index; Not Seasonally Adjusted)
Housing Market
January home sales in East Tennessee increased 6.4% from December at a seasonally adjusted annual rate (SAAR) of 19,708, an increase of 8.4% over 2025.
January home sales in Knox County increased 4.7% month over month, up 14.7% from 2025, at a seasonally adjusted annual rate (SAAR) of 7,759.
The median home sales price across the East Tennessee region was $360,000 in January, no change from 2025. Knox County’s median home sale price held steady at $385,000, down 1.6% from 2025.
Half of the homes sold across the East Tennessee region went under contract in 47 days or less, up from 38 days last year.
Active inventory in the East Tennessee region was up 25.4% from the previous year.
Months of inventory for East Tennessee, or the number of months it would take to exhaust active listings at the current sales rate, remains tight at 4.1 months due to unseasonably robust sales activity in December and January.
East Tennessee REALTORS® released its 2026 Housing Market Forecast Report in January. Forecast highlights include home price growth of 3.1%, a 6.8% increase in total home sales from 2025, and an estimated 1.6% drop in rent. You can access and download the full report here.
You can subscribe to the East Tennessee REALTORS® monthly Market Pulse Newsletter here.
East Tennessee REALTORS® reports monthly home sales patterns using a seasonally adjusted annualized rate (SAAR), an adjusted rate that takes into account typical seasonal fluctuations in data and is expressed as an annual total. Comparing month-over-month housing market data using this method provides a more accurate depiction of home sales.
(Sources: National Association of REALTORS®; East Tennessee REALTORS®)
(Sources: U.S. Housing & Urban Development – SOCDS – State of the Cities Data Systems; U.S. Census Bureau – Building Permits Survey)
National Retail Sales
Data note – due to the federal government shutdown, January 2026 data is delayed.
The total advance monthly retail sales estimate for December 2025 was $816.510 billion (up 10.8% from November and up 2.7% from last December.)
The retail sectors that showed sales growth from last December were Health and Personal Care Stores (+7.6%), Non-store Retailers (+6.2%), Building Materials (+5.1%), Sporting Goods/Books/Hobby/Music Stores (+4.6%), Food Services and Drinking Places (+3.2%), Gasoline Stations (+2.9%), Clothing Stores (+1.5%), Food and Beverage Stores (+1.2%), Miscellaneous Stores (+0.8%), Electronics and Appliance Stores (+0.4%), Motor Vehicles and Parts Sales (+0.4%), and General Merchandise Stores (+0.3%).
The only retail sector that showed a decline in sales from last December was Furniture and Home Furnishings Stores (-5.9%).
(Source: U.S. Census Bureau; Advance Monthly Retail Trade Reports; Not Adjusted)
Tennessee State and Local Sales Tax Collections
The Knoxville MSA region collected $145.607 million in state sales taxes in January (up 14.1% from December and up 3.3% from last January) and Knox County collected $95.667 million in January (up 14.5% from December and up 2.1% from last January.) The state of Tennessee collected $1.460 billion in state sales taxes in January (up 19.6% from December and up 4.3% from last January.)
The Knoxville MSA collected $59.202 million in local sales taxes in January (up 18.3% from December and up 7.6% from last January) and Knox County collected $36.146 million in January (up 19.0% from December and up 6.2% from last January.)
(Source: Tennessee Department of Revenue)
Tennessee Ranks #19 on MoneyGeek’s Best States to Start a Small Business 2026
MoneyGeek, an insurance comparison website, recently released its rankings of the Best States to Start a Small Business 2026. The analysis ranked all 50 states plus the District of Columbia across 14 metrics organized into four weighted pillars including Business Environment and Opportunity (business formation rates, small business job creation share, small business employment share, and broadband availability), Access to Resources and Capital (loans per small business, high-propensity business applications, college-educated population, and working-age population growth), Business Costs and Taxes (Tax Foundation tax competitiveness scores, commercial electricity price, and regional price parity), and Failure Risk and Stability (five-year establishment survival rates, one-year survival rates, and natural disaster risks).
Overall, Tennessee ranked #19. By pillar, the Volunteer State was #44 for Business Environment and Opportunity, #17 for Access to Resources and Capital, #6 for Business Costs and Taxes, and #29 for Failure Risk and Stability. The top 10 Best States to Start a Small Business were #1 Wyoming, #2 South Dakota, #3 North Dakota, #4 Montana, #5 Delaware, #6 Mississippi, #7 Iowa, #8 Texas, #9 Florida, and #10 Utah. You can read more here.
Recent Business Expansions and New Business Announcements in the Knoxville Region
In this section of ECO, we share announcements of businesses that are expanding their existing operations or locating a new facility in the Knoxville region. If you would like to share your business expansion announcement with us, please send your info to [email protected].
New and existing industries continue to invest in the Knoxville region.
January 23, 2026 – Centrus, a nuclear fuel supplier, announced a $560 million expansion of its uranium enrichment centrifuge manufacturing plant in Oak Ridge. The expansion will create 430 new jobs and will support Centrus’ recently announced expansion plans of its Ohio uranium enrichment plant. The first new centrifuges produced in Oak Ridge will come online in Ohio in 2029. You can read more here.
Knox County Business Licenses
New business licenses issued in January 2026 by Knox County are up 239.7% from December and are up 2.8% from January 2025.
A total of 411 new business licenses were issued in January 2026 compared to 121 in December and 400 in January 2025. The top industry sectors for which business licenses were issued in January 2026 were services, non-classified, retail, and construction.
Below is a chart showing the 13-month trend of business licenses issued by Knox County.
(Source: Knox County Clerk)
McGhee Tyson Airport (TYS) Passenger and Freight Trends
The Metropolitan Knoxville Airport Authority recorded 220,874 passengers in January (down 5.0% from January 2025.) Year-to-date (12 months-to-date) passenger traffic through January is 3,618,751 (up 7.1% from year-to-date passenger traffic through January 2025.)
The total freight recorded in January at TYS was 3,866,053 pounds (down 14.8% from January 2025.)
According to the Transportation Security Administration, the average daily number of passengers passing through the nation’s TSA checkpoints in January was 2,124,546 (up 0.1% from the January 2025 daily passenger average of 2,121,846 and up 6.8% from the pre-COVID January 2019 average of 1,990,158.) You can view the daily TSA checkpoint travel numbers here.
According to the International Air Transport Association (IATA) , “Domestic RPK (Revenue-Passenger-Kilometers) in the U.S. declined by 0.7% YoY, the third consecutive month of contraction. This was accompanied by a 1.2% reduction in capacity, with the US government shutdown contributing to the reduction in both demand and capacity. The load factor rose by 0.4 percentage points to 78.7%, remaining below the industry average.” You can read more here.
(Sources: Metropolitan Knoxville Airport Authority; U.S. Transportation Security Administration; International Air Transport Association)
