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State Senate - State of Tennessee
Legislative Press Release
Tennessee working hard to create jobs in challenging economic climate
Officials from the state's Department of Economic and Community Development told Senate Commerce Committee members this week that Tennessee is working hard in a challenging economic climate to create new jobs. The Department came before the committee for consideration of its budget request, which includes expansion of an innovative new program sponsored by Republicans last session called TNInvestco.
Two key components of fostering higher-paying jobs to recruit new industries is developing a highly skilled work force and investing in new infrastructure. In the midst of the worst recession and highest unemployment rate in recent history, the state has brought in $6 billion in new capital investment in fiscal year 2008-09. This includes the location of two major plants, Volkswagen in Chattanooga and Hemlock in Clarksville.
Recruitment of major new industries is a primary objective of the Department. However, approximately 84 percent of Tennessee companies are small businesses, generating $23 billion in annual personal income. According to Senate Commerce Committee Chairman Jack Johnson (R-Franklin), this fact shows the importance of creating a good business climate for small companies and means lawmakers must be vigilant to resist efforts to erode that status by increasing taxes or implementing new "job killer" mandates.
The editors of Site Selection magazine, one of the nation's premier economic development publications, have ranked Tennessee among the five best states in the U.S. for best business climate. This is in addition to being named one of the best states for jobs and business growth. This is mainly due to the fact Tennessee is a right to work state, lacks a personal income tax, has comparatively low business tax rates, and the natural advantages of a good location.
Tennessee is also one of the top three states in the U.S. for clean energy jobs according to the Pew Center for the States. Recent legislation passed by the General Assembly has raised the state's profile in sustainable energy.
On TNInvestco, Economic and Community Development Commissioner Matt Kisber said the program is now looked at as model legislation for other states. TNInvestco helps to make investment capital available to small, medium and start up businesses in Tennessee. The goal is to develop Tennessee's entrepreneurial infrastructure, to bring additional capital into the state, to diversify the state's economy and to create "anchors" or "clusters" of business innovation which can result in new companies being created in Tennessee. Expansion of the program would allow the state to include two more firms, currently listed as alternates, to provide investment potential to more Tennessee businesses which qualify.
The state's economic downturn and the rise in unemployment provide legislators with serious financial challenges, but job creation is a top priority as Tennessee looks toward economic recovery. Small businesses provide 67 percent of first jobs and produce 55 percent of innovations. This legislation helps to tap into this vast potential to encourage job growth in the state.
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