Will Labor Shortage Slow Tennessee Manufacturing Growth?

Date: September 06, 2017

Related Content: News Labor Tennessee

Tennessee’s manufacturing industry is currently holding steady at a ‘B’ grade, but they’re facing a pending labor shortage.

Conexus Indiana, a private sector initiative focused on the manufacturing and logistics sectors of the economy, produces an annual state-by-state report card with the help of the Ball State University Center for Business and Economic Research. The report card ranks each state on several different categories that are important to manufacturing and logistics site selection professionals. According to the 2017 report, Tennessee earned mostly strong marks across the board:

  • Manufacturing industry health: B
  • Logistics industry health: C+
  • Human capital: D
  • Worker benefit costs: A
  • Tax climate: C
  • Expected fiscal liability gap: B
  • Global reach: B+
  • Sector diversification: B-
  • Productivity and innovation: C-

Tennessee’s lowest grade—human capital—is no surprise, given that manufacturers cited workforce challenges as their biggest concern, ahead of regulations, taxes, and roads, in a survey conducted by the Tennessee Manufacturers Association. One of the key problems, reports the Chattanooga Times Free Press, is that one of every four factory workers—roughly 75,000 workers—will be retiring in the next 10 years and at the same time, the skill demands will continue to rise.

However, manufacturers are mostly optimistic. Manufacturing employment has steadily increased over the past seven years, and Tennessee manufacturers are generating more than $51 billion of economic output each year.


Related Content: News | Labor | Tennessee

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