Why Nashville just slipped from its spot as the nation's leader in job growth

Sandy Mazza | The Tennessean

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Nashville's economy expanded so quickly last year that it led the nation's large cities in job growth.

But that surge decelerated this year as employers struggled to find enough workers.

Between May 2016 and May 2017, Nashville's expanding job market enjoyed 4 percent growth — more than any other metropolitan area with 1 million or more residents. That dropped to 2.1 percent from June 2017 to June 2018, according to data from the federal Bureau of Labor Statistics.

The expansion, while slowed, still bested national employment growth of 1.7 percent in the year ending in June.

During the same period ending in June, the frenetic influx of new Nashville residents dipped from an average of 100 people a day to the still-enormous number of 94 new arrivals daily.

Meanwhile, frenzied development continued with hotels, restaurants, tech startups and other businesses eagerly snatching up real estate.

Nashville Area Chamber of Commerce President Ralph Schulz said there aren't enough workers to fill open positions in technology, health care, hospitality and other industries.

"Workforce is scarce right now," Schulz said. "What's keeping us in the game largely is in-migration."

Community leaders are working to develop more local talent for these open jobs. High school training programs are preparing new graduates to jump into the job market.

Like most hotels and restaurants in the area, downtown's largest hotel — the 800-room Omni — has had a persistent labor shortage since it opened five years ago.

"We have the most amount of open positions we've had in our five years," said Dan Piotrowski, Omni's vice president of operations and co-chair of the Nashville Convention and Visitors Corp. workforce development committee. "We fluctuate between 60 and 80. Right now, we have 80 open housekeeping, culinary and server positions."

The Omni encourages employees to seek promotions to help retain talent, he said.

But sometimes the allure of a popular new business, like the celebrity-fronted honky-tonks on Lower Broadway, draws away staff members.

Schulz said Nashville's employment struggles could be a reckoning for a city roiled by five years of rigorous development.

"To some degree, lower job growth is not a bad thing," Schulz said. "Nashville doesn't want to be known as a community with an excess of workforce.

"Nashville was the first city out of the recession. Jobs grew. In-migration grew. Now we hit a point in the cycle where a lot of economic aspects are coming back into balance. We're going to be in a steady period earlier than other cities. Then the growth is likely to resume."

Reach Sandy Mazza at smazza@tennessean.com or 615-726-5962 and on Twitter @sandymazza.​​