Tennessee: Focus Is on “Green” Jobs, Fast Track Service

April 01, 2010
By  Kathy Moore Cowan

Matt Kisber, commissioner of the Tennessee Department of Community and Economic Development, admits that “Tennessee historically is not the first state that comes to peoples’ minds when they think about ‘green’ jobs.” However, the Pew Center on the States ranks Tennessee as one of the three fastest-growing states in the country in “green” collar jobs. Between 1998 and 2007, “green” jobs in Tennessee grew at a rate of 18.2 percent, doubling the national rate of 9.1 percent. From all indications, more growth in this industry is expected.

Memphis BioWorks Foundation recently received a $2.9 million grant for job training in energy efficiency and renewable energy occupations; and, last year, the governor announced the development of the West Tennessee Solar Farm (Haywood County), a five-megawatt, 20-acre power generation facility. To make sure Tennessee maintains a leadership position not just in manufacturing of products but in the innovation that takes place, the Tennessee Solar Institute is being developed in East Tennessee as a partnership between the state, the University of Tennessee and Oak Ridge National Laboratories.

Another new industry in Tennessee is high-value distribution and logistics, where a company brings in and warehouses a partially completed project, completes it based on the customer’s demands, and then distributes it to the customer. The medical device manufacturing industry is one example. Memphis has become the center of this industry in the country. Also, headquarters function activity has increased. More companies are moving their divisional, regional and global headquarters to Tennessee. Almost 50 corporate headquarters have been recruited to the state in the last seven years. The state also has been successful in expanding its automotive industry, landing a Volkswagen automotive manufacturing plant in Chattanooga that should begin production next year.

To strengthen the state’s ability to recruit new companies, the governor established the Fast Track process, a multi-departmental procedure to respond to companies interested in coming to Tennessee. The commissioners of Labor and Workforce Development, Community and Economic Development, Education and Human Service make up the Jobs Cabinet, where these departments work together to generate a proposal within 24 hours of a company’s request. This has helped Tennessee be successful despite the current economy, Kisber said.

Although there have been successes in the state as a whole, there are a number of regions that have lost businesses. For example, a General Motors Plant (formerly Saturn) in Middle Tennessee closed, resulting in a loss of 5,000 jobs.

To address the needs of displaced workers, Susan Cowden, administrator of workforce development in the Department of Labor and Workforce Development, said the state has extended unemployment benefits and conducted outreach to the unemployed, encouraging them to get retraining in high-growth sectors such as biomedical, energy, health care and information technology. The American Recovery and Reinvestment Act (ARRA) funds have enabled the state to pay for additional classes from approved training providers in instances where classes are full and where new classes are needed for emerging industries. As the unemployment rate has doubled, the funds have allowed the state to double the number of people receiving workforce services.

In Perry, Lauderdale and Hancock counties, some of the hardest hit by unemployment, the state has implemented the subsidized employment program, where people work in the private and public sectors on jobs that are 100 percent subsidized with public monies. Funds come from the Temporary Assistance for Needy Families (TANF) program administered by the Department of Human Services. Additional funds from ARRA have subsequently been used, requiring less stringent eligibility criteria and resulting in more displaced workers being helped. Cowden anticipates using this model in other economically depressed counties where the unemployment rate is high and the primary industry has closed.

West Tennessee has historically had low educational attainment levels relative to the rest of the state and the country and persistently high levels of unemployment. “Education is by far the most important aspect in making a decision where to invest capital and locate jobs because today’s workers have to do more than just have a strong back,” he said. The state has made significant improvements in education in the last seven years to prepare Tennesseans for the jobs of tomorrow—most notably the establishment of a pre-kindergarten program, raising achievement standards, reorganization of higher education, and research enhancements to the University of Tennessee and other higher education facilities.

Bridges is a regular review of regional community and economic development issues. Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.

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