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TENNESSEE
From Site Selection magazine, January 2017
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The Race For The Workforce of Today

TENNESSEE
Tennessee’s successes bring challenges and opportunities.
Photo: Getty Images

by GARY DAUGHTERS

If stock car racing was born in Tennessee, as reliable legend has it, then maybe it’s simply fitting that the Volunteer State is leaving business competitors in its dust.

The Brookings Institution, in August, ranked Tennessee number one among all US states for advanced industry growth. Brookings said advanced industry jobs increased in Tennessee by an average of 4.6 percent annually from 2013-2015, far ahead of the national average.

In addition, Tennessee tied for fourth in Site Selection’s recent 2016 survey of state business climates (Georgia was No. 1).

Workers assemble a Chevrolet Equinox at the GM plant in Spring Hill, Tennessee.
Photo courtesy of General Motors

But as a detailed analysis of the Tennessee workforce confirms, having a solid business climate presents challenges unto itself. One of those faced by Tennessee, like so many other local, state and regional economies, is to build and sustain the modern labor force it needs to cross the finish line — which some might call the starting line for the future.

Now Hiring

Tennessee’s annual LEAP (Labor Education Alignment Program) analysis, released in November, points clearly, maybe tellingly, to well-paying openings in the state’s advanced industries. It identifies 255 occupations that are currently in high demand, as defined by the numbers of postings and hires for specific job classifications relative to the jobs spectrum as a whole.


“Tennessee is seeing a lot of growth in advanced industries that follows on a generation of much less technical, advanced enterprise.”
— Mark Muro, Vice President, Senior Fellow and Director of Policy, Metropolitan Policy Program at Brookings Institution

“Tennessee is seeing a lot of growth in advanced industries that follows on a generation of much less technical, advanced enterprise,” says Mark Muro, senior fellow and director of policy at the Metropolitan Policy Program at Brookings. “That means that the statewide skills upgrading needed in the state is more pronounced than elsewhere.”

The LEAP analysis points to needs and possible workforce gaps across the state’s nine geographic regions in skilled job sectors that include but aren’t limited to:

  • Healthcare
  • Computer and math
  • Engineering
  • Architecture
  • Production
  • Management
  • Business and financial operations
  • Sales and related
  • Arts
  • Design
  • Entertainment
  • Sports
  • Media

According to the LEAP analysis:

“Management had the greatest share of in-demand job classifications (24 out of 34 management occupations identified as in-demand), followed by computer and mathematical occupations (12 of 19 computer and mathematical occupations identified as in-demand), and sales (13 of 22 sales occupations identified as in-demand.)”

Tennessee’s on-going efforts at education, workforce training and jobs matching get high marks, but the climb is a steep one, analysts say.

“I would say that Tennessee has focused as hard on these issues as any other state,” says Muro. “With that said, the challenge is huge here, and there is evidence of very tight labor markets, positions being hard to fill, and persistent skills match problems.

“Remember,” reflects Muro, “this is a state that faces not just the normal skills challenge but the need to structurally reposition itself from a more agrarian, commodity manufacturing history to participation in the global advanced sector. So, the need to up its game is urgent.”

Wanted: STEM Students

As the acronym implies, LEAP is a state-run program that helps Tennessee communities and colleges align educational degrees, certificates and course offerings with the needs of the state’s workplaces. It’s one of a potent array of pipelines Tennessee Governor Bill Haslam has secured to funnel money into higher education to keep pace with the boom in skilled employment opportunities.

Because of Tennessee’s advanced industrial orientation, the 2016 LEAP analysis places special focus on tracking possible gaps between STEM-related job openings and qualified workers to fill them. In addition, it identifies in copious detail existing programs of postsecondary study, by region and specific location, linked to four critical areas that are both in-demand and heavy on STEM-skilled workers:

  • Production
  • Information Technology
  • Engineering
  • Healthcare

The analysis, done in conjunction with the Center for Economic Research in Tennessee (CERT), is aimed at, among others, policy-makers throughout Tennessee who are tracking the evolution of workforce demand.

Gunning for Glory

Among the many factors boding well for the Volunteer state: In the race to educate the workforce of the future, Tennessee is laps ahead of much of the competition. On education, Gov. Haslam has put the pedal to the metal, and he’s got the state legislature backing him up like a pit crew.

In 2016, Haslam asked for and received $261 million for public education, the highest K-12 investment without a tax increase in the state’s history, he said. In his plea for more from lawmakers, he highlighted some of what he’s tackled so far.

“What’s important in all this is that we’re not investing in the same old public education system in Tennessee,” he said in his February 2016 State of the State address. “We’ve raised our standards. We’ve linked teacher evaluations to student performance, and we’ve expanded teacher evaluations to student performance, and we’ve expanded education options for children.”

In the increasingly critical postsecondary realm, Haslam persuaded state lawmakers to approve $10 million for LEAP, and even more for his other two higher-ed pipelines:

  • $24.3 million for the “Drive to 55” program, designed to ensure that 55 percent of Tennesseans obtain a postsecondary credential by 2025
  • $50 million for “Complete College” funding, which supports and coordinates programs among Tennessee’s community colleges 
  • $23.8 million for “Tennessee Promise,” a popular program that covers two tuition-free years at any of the state’s certified technical colleges
  • $13.2 million for a need-based student financial award program
  • $9.5 million for “non-formula” units such as Colleges of Medicine and the University of Tennessee Health Science Center
  • $311 million for budget maintenance and new construction

Solid State

At 4.8 percent as of October, Tennessee’s unemployment rate, as tracked by the U.S. Bureau of Labor Statistics, was a tick below the national average of 4.9 percent. The state’s rate of job creation in 2016, 2.4 percent, ranked among the nation’s highest. Haslam boasts of boosting private-sector employment by 16 percent since the start of his administration in 2111.

Its workforce development challenges aside, Tennessee continues to expand working capacity across advanced industry sectors. According to Site Selection’s proprietary Conway Projects Database, General Motors and Google were among the biggest investors in new projects in Tennessee in 2016.

As previously chronicled in Site Selection, Google cemented plans to build a $600 million data center at a former TVA megasite in Clarksville, a project expected to create about 70 full-time jobs. GM, already a major investor in Tennessee, announced two separate expansions at its Spring Hill facility totaling $937 million. The projects unveiled in February and October will open the Spring Hill plant to V8 production for the first time and support the development of new, high-efficiency engines. Together, the two projects are expected to create close to 1,000 new jobs.

Gary Daughters
Senior Editor

Gary Daughters

Gary Daughters is a Peabody Award winning journalist who began with Site Selection in 2016. Gary has worked as a writer and producer for CNN covering US politics and international affairs. His work has included lengthy stints in Washington, DC and western Europe. Gary is a 1981 graduate of the University of Georgia, where he majored in Journalism and Mass Communications. He lives in Atlanta with his teenage daughter, and in his spare time plays guitar, teaches golf and mentors young people.

 



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