Tennessee, September 12, 2025
News Summary
A report reveals that nearly half of Tennessee residents are struggling with rising living costs, despite economic growth. Essential expenses like housing, transportation, and food have surged, while wages in critical sectors remain low. The report also highlights wage disparities among ethnic groups and the impact of an influx of new residents on the housing market, exacerbating affordability issues. With significant tax revenue losses in Hamilton County due to business incentives, the situation calls for effective strategies to ensure equitable economic benefits for all Tennesseans.
Nashville
A recent report from Think Tennessee highlights that nearly half of the state’s residents are struggling to cope with the rising cost of living, despite the state experiencing an economic boom. The data reveals that not all Tennesseans are benefiting equally from the state’s growth, with many facing financial hardships as essential living costs surpass wage increases.
Major expenses, including housing, transportation, child care, health care, and food, have been rising rapidly since 2020, outpacing wage growth significantly. For instance, while a “living wage” for a family of three in Tennessee is calculated at $36.31 per hour, workers in critical sectors such as agriculture, retail, food service, and education earn, on average, between $9 to $20 less.
The report also reveals a troubling wage disparity among ethnic groups in Tennessee. Hispanic workers earn, on average, 23% less than their white counterparts, while Black workers earn 16% less. This discrepancy further complicates the financial struggles faced by many families, as they often have to make heartbreaking decisions between paying for housing or purchasing groceries.
The reliance on governmental and nonprofit funding for research and development in Tennessee stands higher than the national average, with 32.2% and 13.5% of funding sourced from these entities, respectively. The reduction of federal infrastructure funding could hinder critical local projects, including Chattanooga’s power grid expansion.
From 2017 to 2023, Hamilton County experienced a loss of about $71 million in tax revenue due to tax incentives intended to stimulate business and economic growth. While Chattanooga and Hamilton County have engaged in agreements with large employers to encourage job creation, not all projects have met the anticipated outcomes, leading to concerns about job security and growth prospects.
The influx of about 24,000 new residents from California in 2023 has significantly impacted housing demand and prices, making the situation more precarious for residents struggling to find affordable living conditions. The state’s demographic changes, which include an increase in residents identified as multiracial and Hispanic or Latino, alongside an aging population and growing urbanization, exacerbate existing issues.
The median home price in six counties has doubled since 2014, with rental costs rising over 50% statewide, contributing to the growing affordability crisis in housing. Coupled with rising costs and strict zoning regulations, developers find it difficult to create affordable housing options, further intensifying the challenges many residents face.
Conclusions
The economic disparity and escalating living costs in Tennessee are creating significant barriers for many residents, hindering their ability to secure affordable housing and live comfortably. This situation calls for comprehensive strategies and approaches to ensure that all residents can participate in and benefit from the state’s economic growth.
FAQ Section
What is a living wage for a family of three in Tennessee?
The calculated living wage for a family of three in Tennessee is $36.31 per hour.
How much less do Hispanic and Black workers earn compared to white workers in Tennessee?
Hispanic workers earn an average of 23% less, while Black workers earn 16% less compared to their white counterparts.
How has the influx of new residents impacted the housing market in Tennessee?
The new residents have contributed to increased housing demand and prices, worsening the affordability crisis.
What has happened to tax revenue in Hamilton County from 2017 to 2023?
Hamilton County lost approximately $71 million in tax revenue due to tax incentives aimed at encouraging business growth.
What are the main factors contributing to the rise in living costs in Tennessee?
Housing, transportation, child care, health care, and food costs have increased significantly, outpacing wage growth since 2020.
Key Features Overview
| Feature | Details |
|---|---|
| Living Wage for Family of Three | $36.31 per hour |
| Wage Disparity | Hispanic workers: 23% less; Black workers: 16% less than white workers |
| Increase in Housing Costs | Median home price doubled; rental prices increased over 50% |
| New Residents Impact | 24,000 residents from California increased demand for housing |
| Tax Revenue Loss in Hamilton County | $71 million lost due to tax incentives |
Deeper Dive: News & Info About This Topic
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Additional Resources
- Tennessean: Tennessee Economy Growth Report
- Wikipedia: Economy of Tennessee
- NFIB: Tennessee’s Economic Outlook
- Encyclopedia Britannica: Tennessee
- WATE: Tennessee’s Economy Growth Forecast
- Google Search: Tennessee Economy
- Clarksville Online: Marsha Blackburn on Tennessee’s Economic Success
- Google News: Tennessee Economic Growth
Author: STAFF HERE CHATTANOOGA WRITER
The CHATTANOOGA STAFF WRITER represents the experienced team at HEREChattanooga.com, your go-to source for actionable local news and information in Chattanooga, Hamilton County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Riverbend Festival, Chattanooga Oktoberfest, and Moon River Festival. Our coverage extends to key organizations like the Chattanooga Area Chamber of Commerce and United Way of Greater Chattanooga, plus leading businesses in manufacturing, insurance, and utilities that power the local economy such as Volkswagen Chattanooga, BlueCross BlueShield of Tennessee, and EPB. As part of the broader HERE network, including HEREBristol.com, HEREKnoxville.com, HEREMemphis.com, and HERENashville.com, we provide comprehensive, credible insights into Tennessee's dynamic landscape.
