NASHVILLE, TN (WGNS) - The Volunteer Statestepped into 2026 with a small but encouraging shift in its labor market. New data from the Tennessee Department of Labor and Workforce Development shows the state’s seasonally adjusted unemployment rate dipped to 3.5 percent in January, down a tenth of a point from December and matching the rate recorded a year earlier. The state continues to outperform the national unemployment rate, which climbed to 4.3 percent in January.

Throughout 2025, Tennessee’s unemployment rate barely budged, holding steady between 3.5 and 3.7 percent each month. That stability carried into the new year as employers continued adding jobs across several key industries.

Over the past twelve months, Tennessee employers created 5,900 new nonfarm positions. Health care and social assistance led the way, followed by gains in state government and in the arts, entertainment, and recreation sector. Month‑to‑month growth was even stronger: employers added 7,200 jobs between December and January, with the biggest increases in private education and health services, professional and business services, and financial activities.

Alongside the statewide numbers, TDLWD is highlighting another tool that’s becoming increasingly valuable for both employers and job seekers: county‑level commuter data. The dataset maps where Tennesseans live, where they work, and how far they travel each day. It also shows how deeply connected local labor markets have become, especially in fast‑growing regions like Middle Tennessee where workers routinely cross county lines for employment.

For employers, those patterns can reveal untapped labor pools, emerging laborsheds, and potential locations for expansion or recruitment. For workers, commuter data can point to job opportunities beyond their home county, typical travel times, and even how remote‑work trends are reshaping regional job hubs.