Basic information about the Tennessee Economy
Overview of the state’s economy
- Tennessee is the 36th largest state in the nation, and is about one-quarter the size of Japan.
- The state has a total population of 6.3 million and is the 17th most populous state in the United States (2013) . While 93% of the land is considered rural, 66% of the population resides within the remaining 7% of land that is considered urban.
- In Tennessee, the civilian labor force is approximately 3.0 million; just over 62% of the workforce is concentrated in 1) trade, transportation & utilities, 2)government, 3) education & health services, and 4) professional & business Services. Only about 2.1% of the state’s employed work in agriculture. The states’ unemployment rate was 6.3% in April 2014.
Priority economic sectors of state government
- Governor Haslam’s economic plan focuses on both improving childhood education and also continuing education for adults; improving economic development resources for companies of all sizes; and tax reform.
- Multiple education initiatives are directed at preparing students for college and getting them to graduate college with the skills employers need. One of the Governor’s biggest agenda items is “Drive to 55,” a multi-policy campaign with the goal of raising the number of state residents with a college degree to 55% by the year 2025. Part of “Drive to 55” is “Tennessee Promise”, which will allow high school graduates to attend a two-year community or technical college for free. The “SAILS” program is aimed at decreasing the number of high school graduates that need remedial math when they enter college.
- On the economic development front, nine regional directors are tasked with working closely with local communities to help incorporate them into broader regional strategies for development. These regional directors are intended as the primary point-of-contact for companies seeking assistance with expansion. Additionally, six state-wide project managers are tasked with attracting new investment in select sectors. Four other state-wide officers work directly with Tennessee companies to encourage exports abroad, including utilizing the TNTrade program, which educates potential exporters how to sell abroad.
- Sectors specifically targeted by Tennessee include 1) automotive, 2) chemicals & plastics, 3) advanced manufacturing & energy technologies, 4) transportation, logistics and distribution services, 5) business services, and 6) healthcare.
Japanese companies in Tennessee:
- The Tennessee Department of Economic and Community Development reports nearly 180 Japanese-owned companies operating in the state. Employment by Japanese owned companies is estimated at about 40,000 people, accounting for about 35% of all employment created in Tennessee by foreign direct investment. Japan is the largest foreign investor in Tennessee.
- Japanese companies represented in Tennessee include auto-related companies such as Nissan North America, Yorozu Automotive, M-Tek, Bridgestone Americas, and Denso Manufacturing.
- Nissan moved its North American Headquarters from California to Tennessee in 2005. Additionally, the company has a Powertrain Assembly Plant in Decherd, TN and a Vehicle Assembly Plant & Battery Plant in Smyrna, TN. A new engine plant, a joint venture between Infiniti and Daimler Benz, opened adjacent to Nissan’s Powertrain Assembly Plant in June 2014. The facility will produce engines for Mercedes and Infiniti. Many supplier companies have located in Tennessee to have convenient access to the automotive cluster.
Basic Economic Information
- Tennessee’s real GDP in the state is 270 billion dollars, the 19th largest in the United States. The real economic growth rate rose 0.8% from 2011 (2012 data). Per Capita Personal Income in 2013 was just over $39,000, or 88% of the national average. Tennessee ranked the 34th among the states in personal income average.
- The seasonally adjusted state unemployment rate was 6.4% in May 2014, above the national level of 6.3% for May.
- GDP ratio by industry for 2013: manufacturing 16%, real estate 12%, government 12%, medical services 10%. Agriculture is less than 1%. (Please refer to the Jurisdictional Information section of our webpage for details.)
Economic relations with Japan
- Regarding the foreign direct investment, Japan’s direct investment to Tennessee is approximately 15 billion dollars, accounting for 60% of the total foreign investment and making Japan Tennessee’s No.1 investor. According to the state government report, approximately 40,000 jobs are created by Japanese-owned companies, accounting about 60% of all employment created in Tennessee by Foreign direct investment.
- Imports and Exports: Major exports to Japan include miscellaneous manufactured commodities, computers & electronics, chemicals, and transportation equipment. Tennessee exports to Japan total about $2 billion annually. Top imports from Japan include transportation equipment, machinery (excl. electrical), computers and electronics, and fabricated metal products. Annual imports from Japan have averaged just over $10 billion for 2012 and 2013.
Contact information about Tennessee ’s Representative Office in Japan
Mr. Takatsugu Yamaguchi,
Director State of Tennessee Japan Office
2-2-1 Shinko, 6th Floor, Naka-ku, Yokohama 231-0001 JAPAN