Tenn. economy should be ‘substantially stronger’ in 2014

Tennessee’s economy will continue modest growth this year, but should be “substantially stronger”in 2014, University of Tennessee economists said today.

On the national scene, the economy is expected to grow slowly in the coming months with a steady decline in the unemployment rate, according to the annual economic forecast prepared for the governor by UT’s Center for Business and Economic Research.

“The U.S. economy is projected to continue to grow in the quarters ahead and the unemployment rate will continue its slow but steady decline,” said Matt Murray, associate director of CBER and the report’s author. “For Tennessee, the economic outlook calls for modest growth in 2013 followed by substantially stronger growth in 2014.”

Good signs for the national economy include a rebounding housing sector and continued growth in manufacturing jobs, the report says. However, gross domestic product will post a meager 1.7 percent growth this year, down from 2.3 percent in 2012. Unemployment will edge lower. ending the year at 7.6 percent.

Tennessee’s jobless rate will drop this year and next, but will remain above pre-recession levels, falling to 7.9 percent this year and 7.5 percent in 2014, the report says.

Other Tennessee highlights from the report:

Nonfarm jobs will grow 1 percent in 2013 and 1.7 percent in 2014.

Natural resources, mining and construction, along with professional and business services will see the strongest growth rates.

Click here to read the full CBER report.