Nashville-Davidson--Murfreesboro--Franklin has earned an overall grade of A+ with a composite score of 69.0th percentile, ranking it among the top US metros. The city's economic character is most defined by its strong labor demand, with a composite score in the 80th percentile, and its low unemployment rate of 2.80%, which places it in the 88th percentile. These metrics signal a highly competitive job market with genuine demand expansion.

Labor Demand

The city's employment growth rate of +0.35% year-over-year, combined with a +0.942% deviation in weekly hours from its own trend, indicates genuine demand expansion. This combination signals that the city is adding jobs and workers are putting in more hours, suggesting a strong and growing economy. The labor demand composite score of 5.73 further reinforces this assessment, placing the city in the top tier.

Unemployment

The unemployment rate of 2.80% is exceptionally low, placing the city in the 88th percentile. This tight labor market implies that businesses may face challenges in hiring, as the pool of available workers is limited, and may need to offer competitive wages to attract talent. The low unemployment rate also suggests that workers have strong bargaining power.

Wage Growth

The year-over-year wage growth rate of +7.21% is robust, indicating fast-rising labor costs for employers. This strong wage growth is beneficial for worker purchasing power, as employees can afford more goods and services. However, it may pose a challenge for businesses looking to maintain profit margins.

Cost of Living

With a cost of living ratio of 7.31, which is above average, and a PSF of $260/sqft that is decreasing by -1.1% year-over-year relative to wages of $35.58/hr, the city is relatively affordable, ranking in the 60th percentile. This affordability advantage can attract talent without requiring significant wage premiums, making it an attractive location for businesses.

Labor Force Growth

The civilian labor force is contracting at a rate of -0.82% year-over-year, indicating a shrinking labor pool. This decline in labor force growth may pose a structural headwind for hiring, as the supply of available workers is decreasing. Businesses may need to adapt their recruitment strategies to attract talent from other areas.

Building Permits

The year-over-year change in building permits is -12.54%, indicating a tightening of housing supply. This decline in permits may signal future affordability challenges and constraints on workforce accommodation, as the supply of new housing is not keeping pace with demand.

Days on Market

The current median days on market is 53 days, with a year-over-year increase of +1.9%. This suggests a relatively balanced market, neither extremely competitive nor overly accessible. Relocating workers may still find it relatively easy to find housing, but the market is not as slow as it could be.

Office Economy

With an office/professional worker share of 3.80, ranking in the 86th percentile, the city has a deep talent pool suited for tech, finance, consulting, and HQ decisions. This makes Nashville-Davidson--Murfreesboro--Franklin an attractive location for businesses in these sectors, but less ideal for those in industrial or logistics-dominant economies.

In conclusion, Nashville-Davidson--Murfreesboro--Franklin offers businesses a highly competitive job market with strong labor demand and low unemployment, making it an attractive location for those willing to invest in talent. However, the single biggest risk or constraint is the tightening housing supply, which may pose future affordability challenges and constraints on workforce accommodation, making it essential for businesses to factor this into their location decision.