Updated economic impact numbers reveal remarkable growth of the advanced energy sector, accounting for over 420,000 jobs, nearly 15% of all jobs in Tennessee
The advanced energy (AE) sector in Tennessee grows faster than the overall state economy, employs 420,632 Tennesseans and includes 22,554 businesses that contribute almost $56 billion to the state’s gross domestic product, according to the fourth edition of the “Tennessee Advanced Energy Economic Impact Report” released today by the Tennessee Advanced Energy Business Council (TAEBC) at its 11th Annual Opportunities in Energy event.
The data and analysis in the report shown remarkable growth in this sector of the economy and demonstrate the vital role Tennessee plays in this $2 trillion global market.
“For over a decade, advanced energy in Tennessee has continued to grow faster than the state’s overall economy,” said Cortney Piper, Executive Director of TAEBC. “From former Governor and U.S. Senator Lamar Alexander’s recruitment of automotive OEMs like Nissan in the 1980s, to Silicon Ranch becoming one of the largest independent solar power producers in the world, to our current dominance in elective vehicles, batteries and advanced nuclear technology, Tennessee’s leaders and our world-class research institutions and manufacturing facilities have positioned us to become the No. 1 location in the Southeast for energy innovation and high-quality jobs.”
TAEBC is a statewide organization that champions advanced energy as an economic development and job creation strategy. Every three years, TAEBC releases an Advanced Energy Economic Impact Report to provide context for decisions by public officials and private sector leaders to make lasting contributions to Tennessee’s economic base for the next decade and beyond. Research for the 2024 “Tennessee Advanced Energy Economic Impact Report” was conducted by The Baker School of Public Policy and Public Affairs at the University of Tennessee, Knoxville using County Business Pattern Data from 2019-2022 (the most currently available data).
The 2024 report builds on data analyzed by TAEBC’s 2015 Economic Impact Report, previously updated in 2018 and 2021.
Remarkably, the AE sector has not only grown faster than Tennessee’s overall economy since the last report, but the AE sector has grown faster than the state’s overall economy over the last decade. Notably, AE employment increased by 30% between 2013 and 2022 while total employment across all sectors increased by 19% over the same period. In addition to reporting results by major industry groups, the data is analyzed at the state, metropolitan and county levels.
Key findings from the 2024 report include:
- Advanced energy (AE) generated $55.9 billion in state gross domestic product in 2022, which represents 11.5% of total gross domestic product for the state. Overall, the inflation-adjusted output generated by the AE sector increased by 6.6% between 2019 and 2022, and all AE industry groups experienced growth in AE-related output.
- AE employs Tennesseans with high-quality and high-paying jobs. In 2022, there were 420,632 AE jobs in Tennessee, accounting for 14.8% of all jobs in the state. Annual payroll spending totaled $31.1 billion, and AE workers were spread across 22,554 AE business establishments. The findings imply an average yearly AE salary of $74,025 – 31% higher than the state’s average salary of $56,609.
- AE businesses continue to set up shop in Tennessee at a rapid rate. Total AE employment has grown by 6.8% since 2019, higher than growth in overall jobs across all sectors in the state over the same period. Growth in the number of AE business establishments since 2019 was 10.9% – almost twice the growth in total business establishments in the state.
- Tennessee’s AE economy affects every corner of the state. All 10 metropolitan statistical areas (MSAs) saw growth in AE establishments since 2019. About 67.8% of Tennessee’s AE employment is concentrated in the top 20 AE counties. While AE activity is concentrated in the state’s metropolitan areas, the AE economy extends across all 95 counties.
- AE contributes significantly to Tennessee’s tax base. AE state sales tax revenue totaled $1.5 billion, and AE local sales tax revenue totaled $461.6 million in 2022, a 12.7% and 17.1% increase since 2019, respectively.
- The AE sector is technology-neutral and broadly includes any technology that makes energy cleaner, safer, more secure, or more efficient and includes electricity and transportation.
Case studies included in the report highlight current industry, academia, and nonprofit advanced energy projects and collaborations taking place throughout Tennessee. These partnerships represent some of the nation’s most innovative advanced energy technology deployments, specifically showcasing the strength of Tennessee’s startup and entrepreneur ecosystem, supported by TAEBC’s Energy Network, which operates with support from Launch Tennessee.
Funding for the report was provided by the University of Tennessee, Knoxville and the Tennessee Valley Authority. For more information, visit https://tnadvancedenergy.com.
Image by wavebreakmedia_micro on Freepik.
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