Nashville's Economy called "Goldilocks"....not too hot, not too cold

From the desk of:

Rich Storey
Mortgage Advisor
615.260.8028

Optimism reigns that Nashville will weather recession
Diverse economy, educated work force make region resilient

In past economic slumps, the Nashville area's Goldilocks economy — never overheated, but not too cold either — has usually experienced shorter dives and quicker recoveries than the nation as a whole because of the region's diverse economy and well-educated work force.

That history has left many forecasters and business leaders here optimistic that a national recession triggered by a widespread housing meltdown will deal a much softer — and shorter-lived — blow to Music City business owners and job hunters than to the country as a whole.

A recent report by Garrett Harper, the chamber's research director, shows that Nashville's economy may stumble when the nation's does, but it generally rebounds faster coming out of an economic slump, with stronger job growth about a year after a U.S. recession ends.

"Nashville may enter recessions a bit earlier, but (it) also recovers quickly and much more robustly than the nation in many instances," said Harper, who studied economic data from the early 1970s until the present day to reach his conclusions.

SPECIFIC REASONS TO BE HOPEFUL:

• While home sales are down in the Nashville area, as in the rest of the nation, local prices have remained relatively stable. The median price of a single-family home was just under $170,000 here in September, down 7 percent from a year earlier but far from the double-digit declines seen in many harder-hit cities.

• A shift away from overdependence on manufacturing jobs in the past 30 years makes the eight-county Middle Tennessee region less prone to economic downturns. Diversity of jobs is key to the area's resilience. Manufacturing employs about 10 percent of the area's work force, down from 14.1 percent in 2000.

• The presence of numerous universities in and around Nashville gives the area another source of highly skilled workers, even if it doesn't always lead directly to local job growth.

• One in five Nashville-area workers are self-employed, and that generally helps speed economic recoveries. Others who lose corporate jobs start their own businesses, and that helps as well, said Jeff Cornwall, director of the Center for Entrepreneurship at Belmont University.

As the economic climate of our nation has settled on dark times......it looks like middle Tennessee may offer a ray of hope for it's community.