Tennessee Well Positioned In The Global Economy

Bill Hagerty

Ask any local chamber of commerce leader in Tennessee and they will tell you that the competition for new businesses is fierce among states. 

It is not just a regional, or even national, race for new business. Economic development is a global competition, and Tennessee competes not just with its neighboring states but also with all of Europe and Asia. 

The good news is that Tennessee jobs have been growing at a healthy rate while unemployment has trended downward in the state since Gov. Bill Haslam took office in 2011. 

From January 2011 when Gov. Haslam took office through May of this year, Tennessee added more than 67,000 new jobs, according to federal statistics. 

That put Tennessee in 8th place among all 50 states in jobs growth for the same period. No other neighboring state is even in the Top 10. 

About 29,000 of those jobs are related directly to relocation or expansion projects by our department, using programs like the state’s FastTrack Job Training and Infrastructure programs to help local communities successfully recruit new jobs. 

Tennessee’s unemployment rate has also been reduced under Gov. Haslam’s watch at nearly twice the rate of the national reduction in unemployment. Tennessee has gone from 9.5 percent unemployment in January 2011 to 7.9 percent unemployment in May, a 1.6 percent drop. By comparison, the national reduction in unemployment for the same period was only. 0.9 percent. We still have much more work ahead to get our number down further, but the movement from above the national average unemployment rate to below it demonstrates significant momentum.

In the face of a $1.5 billion budget reduction since Gov. Haslam took office, many have asked how we achieved such a successful result. Our department reduced staff by 42 percent in 2011. At the same time, we created a new model for economic development in Tennessee. We decentralized the management of our department and fielded executive teams in nine new regional Jobs Base Camps around the state – feet on the street interacting with local businesses to help find ways for them to grow and expand.  

We also focused our reduced resources in a very strategic manner, working with companies around the globe to emphasize the significant advantages Tennessee delivers beyond government incentives. 

Tennessee as a state benefits from having one of the lowest debt levels and best balance sheets in the nation. Combine that with being a right to work state with no state income tax, a great infrastructure and compelling logistical advantages. Tennesseans can feel confident about our ability to compete with any state or country. While the economies of other states and countries falter, Tennessee is a fiscal standout.

One of our best wins was the decision by global auto part supplier Magneti Marelli to expand in Pulaski, Tennessee. The Italian company could have picked anywhere in the world to create another 800 jobs, but their leadership picked Tennessee.

The Magneti Marelli project is one of the largest automotive manufacturing projects nationwide in the last year. It represents an international company’s confidence to invest in rural Tennessee and its tireless workforce.

Certainly, we have more to do. We must keep pushing our unemployment rate lower.  And our recruitment efforts remain intense while keeping an eye on the return on investment for Tennessee taxpayers.

Overall, the momentum is terrific in Tennessee. Government does not create jobs, but it can create an environment where the private sector can succeed. That is happening in Tennessee.