Years ago, before I became involved in politics, members of the Tennessee Department of Economic and Community Development Agency (TNECD) spoke at my local Rotary Club and shared a story about their early discussions with Nissan about relocating its North American headquarters from California to Tennessee. At the time, California was experiencing rolling electricity blackouts and the team from TNECD cleverly handed out flashlights to the leaders of Nissan and famously told them, “The lights are always on in Tennessee.”
That story stuck with me and came to mind again recently while I sat with other state and local leaders as we welcomed Moldex, one of the world’s largest manufactures of the N95 mask, to Wilson County.
You see, Tennessee is one of the most business-friendly states in America and businesses around the globe are taking notice. Despite the ongoing COVID-19 pandemic, new companies continue to move to our state every day and bring with them high quality jobs. In fact, statewide unemployment rates fell by 2.3% in the last month alone. This achievement is certainly a testament to the strength and resilience of Tennessee’s economy considering that these numbers have been achieved while living through an unprecedented pandemic.
It’s worth noting that Tennessee continues to recover more quickly and stronger than many other states across our nation who, when faced with the same dire fiscal positions, are considering tax increases.
Here in the Volunteer State we have instead focused on reducing burdensome regulations, cutting red-tape, eliminating and reducing taxes, tort reform and re-envisioning workers’ compensation. Some of these reforms were the most significant improvements to these laws since the original enactment in the early 20th century.
These reforms not only brought our laws into the 21st century, but also streamlined the workers’ compensation process by giving more consistent protections for injured employees.
One major factor in Tennessee’s successful business environment is the historic tax cuts implemented through growth-minded leadership. These cuts — when aggregated since 2010 — total more than $675 million. Another contributing factor is Tennessee’s historic investment in public and higher education over the past decade. Our leaders realize that good public education and workforce development is key to creating a highly skilled workforce ready to work in Tennessee’s diverse economy.
These reforms, tax cuts and investments in education have created an economic and regulatory environment so strong that the state known for the Grand Old Opry is now known as a prime destination for business expansions and relocations.
Despite the economic impacts of the pandemic in 2020, our state managed to continue this trend by balancing our state budget through commonsense reductions and cuts totaling $1.5 billion over a two-year period. These cuts were not easy and were done by making some tough decisions not unlike the decisions made by so many Tennessee families this year.
Tennessee’s fiscal stability is nothing short of tremendous, especially as we look around the nation and compare ourselves to other states. According to the Tax Foundation, Tennesseans experience the lowest state debt per capita and the third-lowest overall individual per capita tax burden in the country.
I would be remiss if I didn’t point out one obvious and proud fact about Tennessee and that is we do all of this without a state income tax.
No doubt this is a major factor in Tennessee’s ability to weather the COVID-19 storm. Because we don’t collect income tax, we were in much better shape when unemployment began to soar in the spring than states that depend heavily on income tax.
More importantly though, leaving Tennesseans’ paychecks alone leaves more money in the pockets of citizens who can make better decisions than the government about how to spend their money.
It is also a key reason Tennessee is so attractive to businesses of all sizes and sectors. According to the Bureau of Economic Analysis, Tennessee’s per capita personal income has increased by 29% over the past 10 years. This is a remarkable testament to our ability to attract high-paying jobs.
Tennessee has carefully and strategically utilized our pandemic response stimulus funds to stabilize and grow our economy. We have done so by identifying new solutions and providing critical resources to support small businesses -including the $200 million Tennessee Business Relief Program and the $50 million Supplemental Employer Recovery Grant (SERG) program. These use federal CARES Act funding to provide immediate help to those most impacted by the pandemic. Entrepreneurs and small business owners suffering from the financial impact of forced closures in the spring and summer have benefitted most from this support.
The Tennessee Unemployment Trust Fund has been an important safety net for those affected by the pandemic. It has provided much needed support to many Tennessee families by helping to pay for groceries, rent, mortgages, childcare and much more during periods without work. By investing federal dollars into our statewide Unemployment Trust Fund, we ensured strong unemployment safeguards for Tennesseans and protected employers from being unfairly penalized. It is estimated this has prevented an almost 300% unemployment tax increase on employers resulting from the tremendous number of claims from the COVID-19 pandemic.
As a member of the General Assembly, I remain focused on enhancing our pro-business, pro-job environment — both in our community and across the state, so we continue to attract new companies to employ the best workforce in America. Our state has achieved so much by removing barriers to success for our business community and allowing them to operate with shared prosperity, and neighborly responsibility as business citizens of Tennessee. Our state will remain a national economic leader under conservative leadership, but also the best place in the entire nation to live, work, raise a family and retire. Perhaps we might even change that famous catch phrase to “In Tennessee the lights are always on…and we are open for business.”
Clark Boyd is a small business owner who lives in Lebanon. He represents District 46 in the Tennessee House of Representatives, which includes Cannon and part of Wilson and Dekalb counties.