Midstate Economic Outlook 2003 Business and Economic Research Center Jennings A' Jones College of Bu

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Midstate Economic Outlook 2003Business and
Economic Research CenterJennings A. Jones
College of Business
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Midstate Economic Outlook 2003

• Economic Update

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Midstate Economic Outlook 2003

• Economic Update
• Important Events

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Midstate Economic Outlook 2003

• Economic Update
• Important Events
• Update for Business and Economic Research Center

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Economic Update

• Population

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Economic Update

• Population
• Employment

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Economic Update

• Population
• Employment
• Taxable Spending

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Economic Update

• Population
• Employment
• Taxable Spending
• Construction

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Population
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Population

• Population growth slows a little

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Population

• But growth remains strong in Williamson and
  Rutherford counties

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Population

• But growth remains strong in Williamson and
  Rutherford counties

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Population Growth in Perspective

• If Rutherford County were a state

Population Change 2000-2002
Iowa 8,018
Rutherford County 7,504
Vermont 6,604
Montana 6,037
South Dakota 5,280
Wyoming 4,617
West Virginia -5,453
North Dakota -7,021
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Population
Davidson Countys share of metropolitan
population continues to plunge.
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Population
Rutherford and Williamson show the largest gain
in share.
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Population
Sources of in-migration for Rutherford County
2000-2001

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Population
Sources of in-migration for Rutherford County
2000-2001

• Davidson County (33)

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Population
Sources of in-migration for Rutherford County
2000-2001

• Davidson County (33)
• Other Tennessee counties (34)

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Population
Sources of in-migration for Rutherford County
2000-2001

• Davidson County (33)
• Other Tennessee counties (34)
• Out-of-state and foreign (33).

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Population
Sources of in-migration for Rutherford County
2000-2001

• Davidson County (33)
• Other Tennessee counties (34)
• Out-of-state and foreign (33).
• Net gain from Davidson County was approximately
  800 households.

Source Internal Revenue Service
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Housing Construction
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Housing Construction
Midstate housing construction shows improvement.
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Employment
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Employment
Nashville MSA nonfarm employment shows little
movement of late.
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Employment
Employment in goods-producing sectors is slowly
improving.
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Employment
Employment in durables manufacturing is slowly
improving.
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Employment
Nondurables manufacturing is threatening to
stabilize.
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Employment
Services-providing industries are growing more
slowly.
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Employment
Fewer counties are experiencing employment gains.
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Unemployment
Unemployment rate drifted up.
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Dispersion of unemployment
Rates remain high in a number of Midstate
counties.
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Taxable Spending
Spending on sales-taxable items is improving.
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Important Events

• Spring Storms

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Important Events

• Spring Storms
• Air Quality

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Important Events

• Spring Storms
• Air Quality
• Job Announcements

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Important Events

• Spring Storms

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Impact of Spring Storms

• Insured claims reached 4.9 billion in the U.S.
• Second highest quarterly loss since 1994.

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Impact of Spring Storms
Insured losses by state (second quarter)
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Impact of Spring Storms
Insured losses by state (second quarter)

• Texas 1.18 billion

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Impact of Spring Storms
Insured losses by state (second quarter)

• Texas 1.18 billion
• Oklahoma 1.07 billion

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Impact of Spring Storms
Insured losses by state (second quarter)

• Texas 1.18 billion
• Oklahoma 1.07 billion
• Tennessee 770 million

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Impact of Spring Storms
Insured losses by state (second quarter)

• Texas 1.18 billion
• Oklahoma 1.07 billion
• Tennessee 770 million
• Missouri 455 million

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Impact of Spring Storms
Insured losses by state (second quarter)

• Texas 1.18 billion
• Oklahoma 1.07 billion
• Tennessee 770 million
• Missouri 455 million
• North Carolina 205 million

Source Insurance Services Office, Inc.
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• Rutherford County hit hard
• Rutherford county insured claims at least 85
  million

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• Rutherford County hit hard
• Rutherford county insured claims at least 85
  million
• 136,000 in FEMA grants to citizens

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• Rutherford County hit hard
• Rutherford county insured claims at least 85
  million.
• 136,000 in FEMA grants to citizens.
• Grants to city government for cleanup.

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Impact of May Storms

• Destruction creates great deal of additional
  spending

• Home repairs and rebuilding

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Impact of May Storms

• Destruction creates great deal of additional
  spending

• Home repairs and rebuilding

• Auto repairs

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Impact of May Storms

• Spending at home building centers increased
  dramatically.

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Impact of May Storms

• Recovery spending creates overtime pay and new
  jobs.

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Impact of May Storms

• Recovery spending creates overtime pay and new
  jobs.
• More personal income, greater retail spending,
  restaurants, entertainment.

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Impact of May Storms

• Recovery spending creates overtime pay and new
  jobs.
• More personal income, greater retail spending,
  restaurants, entertainment.
• Rutherford County Impact
• 42 million in personal income,
• 129 million in industrial output, and
• at least 1,000 jobs.

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Firm Expansion and Local Linkages

• Economic impact is greater
• when firms purchase supplies, materials, and
  intermediate products locally, and

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Firm Expansion and Local Linkages

• Economic impact is greater
• when firms purchase supplies, materials, and
  intermediate products locally, and
• when employees live in Rutherford County.

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Auto Manufacturing Industry

• Impact of the auto manufacturing sector is very
  large due to the network of local suppliers.

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Auto Manufacturing Industry

• Impact of the auto manufacturing sector is very
  large due to the network of local suppliers.

• Purchases from local suppliers create a larger
  economic
• multiplier,
• or ripple, effect.

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Auto Manufacturing and Supplier Linkages
Nissan Smyrna
M-Tek, Inc. Manchester
Kantus Corp. Lewisburg
CS Plastics Fayetteville
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Economic Impact Background

• Nissan
• announced 250 million expansion in Smyrna, TN

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Economic Impact Background

• Nissan
• announced 250 million expansion in Smyrna, TN
• Verizon
• announced it will open a 158,000 square-foot call
  center in Murfreesboro, TN

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Economic Impact Job Announcements

• Nissan
• 800 new jobs in Smyrna

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Economic Impact Job Announcements

• Verizon
• 1,250 new jobs by 2005 in Murfreesboro

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Employment Impact of Nissans 800 New Jobs

• Total employment impact 3,611

152 Jobs in FIRE
120 Jobs in Other Sectors
181 Jobs in TCPU
813 Jobs in Trade
Nissan 800 Jobs
920 Jobs in Services
Auto Manufacturing Industry
Additional 634 Jobs in Manufacturing
Include Agriculture, Mining, Construction,
Government, amd Other
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Employment Impact of Verizons 1,250 Call Center
Jobs

• Total employment impact 2,439

109 Jobs in FIRE
78 Jobs in TCPU
75 Jobs in Other Sectors
274 Jobs in Trade
49 Jobs in Manufacturing
Verizon 1,250 Jobs
Other Business Services
Additional 603 Jobs in Services
Include Agriculture, Mining, Construction,
Government, amd Other
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Summary Nissan Impact
Impact of Nissans Expansion on Regional Economy

• Every dollar of Nissans output
• creates additional 0.65 in industrial output

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Summary Nissan Impact
Impact of Nissans Expansion on Regional Economy

• Every dollar of Nissans output
• creates additional 0.65 in industrial output

• Every dollar of Nissans employee spending
  creates additional 1.81 in labor income

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Summary Nissan Impact
Impact of Nissans Expansion on Regional Economy

• Every dollar of Nissans output
• creates additional 0.65 in industrial output

• Every dollar of Nissans employee spending
  creates additional 1.81 in labor income

• Every Nissan job
• creates an additional 3.5 jobs

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Summary Verizon Impact
Impact of Verizons Expansion on Regional Economy

• Every dollar of Verizons output
• creates additional 0.72 in industrial output

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Summary Verizon Impact
Impact of Verizons Expansion on Regional Economy

• Every dollar of Verizons output
• creates additional 0.72 in industrial output

• Every dollar of Verizons employee spending
• creates additional 0.94 in labor income

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Summary Verizon Impact
Impact of Verizons Expansion on Regional Economy

• Every dollar of Verizons output
• creates additional 0.72 in industrial output

• Every dollar of Verizons employee spending
• creates additional 0.94 in labor income

• Every Verizon job
• creates an additional job

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What is Next?

• Manufacturing is key to job creation in an
  economy.

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What is Next?

• Manufacturing is key to job creation in an
  economy.

• Agile (flexible) manufacturing (e.g., auto
  manufacturing) has tight local linkages that
  generate local jobs and income

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What is Next?

• Southward expansion of the auto manufacturing
  industry from Michigan and Ohio to Kentucky,
  Tennessee, South Carolina, Alabama, and
  Mississippi has important implications for
  Tennessees manufacturing sector.

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What is Next?

• Southward expansion of the auto manufacturing
  industry from Michigan and Ohio to Kentucky,
  Tennessee, South Carolina, Alabama, and
  Mississippi has important implications for
  Tennessees manufacturing sector.

• A comprehensive study is needed to evaluate
  regional linkages in the Tennessee auto
  manufacturing industry and competitiveness of
  Tennessee in this sector.

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Air QualityWhat Does it Mean?
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Air Quality What Does it Mean?
Davidson County not expected to meet EPA
standards (Tennessean, July 2003)
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Air Quality What Does it Mean?
Davidson County not expected to meet EPA
standards (Tennessean, July 2003)
Tennessee Department of Environment and
Conservation officials recently released to the
EPA the list of counties throughout the state
they expect to be out of compliance with the
EPA's tougher eight-hour ozone standard.
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Air Quality What Does it Mean?
Davidson not expected to meet EPA standards
(Tennessean, July 2003)
Tennessee Department of Environment and
Conservation officials recently released to the
EPA the list of counties throughout the state
they expect to be out of compliance with the
EPA's tougher eight-hour ozone standard.
In addition to Davidson, the list contains Middle
Tennessee counties Sumner, Wilson, Rutherford and
Williamson.
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Air Quality

• Rutherford County will likely be designated a
  nonattainment area for ozone.

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Air Quality

• Rutherford County will likely be designated a
  nonattainment area for ozone.
• Must develop a plan to show gradual improvement.

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Air Quality

• Rutherford County will likely be designated a
  nonattainment area for ozone.
• Must develop a plan to show gradual improvement
• Early Action Compact will defer effective date of
  the nonattainment status.

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Air Quality

• Rutherford County will likely be designated a
  nonattainment area for ozone.
• Must develop a plan to show gradual improvement
• Early Action Compact will defer effective date of
  the nonattainment status.
• If ozone levels do not improve, could trigger
  sanctions including freezing of Federal funds.

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Air Quality

• Feds could withhold funds for highways, sewage
  treatment.

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Air Quality

• Feds could withhold funds for highways, sewage
  treatment.
• Nonattainment may create stigma for recruiting.

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Air Quality

• Feds could withhold funds for highways, sewage
  treatment.
• Nonattainment may create stigma for recruiting.
• Some firms may rule out nonattainment areas for
  relocations or expansions.

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Air Quality

• Feds could withhold funds for highways, sewage
  treatment.
• Nonattainment may create stigma for recruiting.
• Some firms may rule out nonattainment areas for
  relocations or expansions.
• Could result in lower speed limit for 18
  wheelers.

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Air Quality

• Policy will focus on obtaining voluntary
  reductions in vehicle miles traveled (vmt) to
  meet the standards.

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Air Quality

• Policy will focus on obtaining voluntary
  reductions in vehicle miles traveled (vmt) to
  meet the standards
• Policy will promote
• Telecommuting,
• Car pooling,
• Use of cleaner fuels,
• Reduced emissions from lawn equipment,
  construction equipment.

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Air Quality

• Could reduction of commuting from Rutherford
  County to Davidson County have significant impact
  on lowering ozone levels?
• 35,000 commuters drive north everyday.

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Update for Business and Economic Research Center

• Tennessees Business
• Horace Johns, editor
• Sally Govan, creative director
• Centers of Excellence

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Update for Business and Economic Research Center

• Tennessees Business
• Horace Johns, editor
• Sally Govan, creative director
• Centers of Excellence
• The Business of Law

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Update for Business and Economic Research Center

• Tennessees Business
• Horace Johns, editor
• Sally Govan, creative director
• Centers of Excellence
• The Business of Law
• Partnerships for Excellence

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Update for Business and Economic Research Center

• Tennessees Business
• Horace Johns, editor
• Sally Govan, creative director
• Centers of Excellence
• The Business of Law
• Partnerships for Excellence

Winner of AUBER excellence award in 1996,
2000, and
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Update for Business and Economic Research Center

• Tennessees Business
• Horace Johns, editor
• Sally Govan, creative director
• Centers of Excellence
• The Business of Law
• Partnerships for Excellence

Winner of AUBER excellence award in 1996,
2000, and
2003!
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Business and Economic Research Center

• Global Commerce
• Steven Livingston, editor

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Business and Economic Research Center

• Midstate Economic Indicators
• Quarterly overview
• Government finances
• Migration
• Real estate issues

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Business and Economic Research Center

• New contracts with
• Nashville Business Journal
• Destination Rutherford
• County of Rutherford
• Northwest Tennessee Workforce Board
• Nashville Chamber of Commerce
• The Tennessean

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Business and Economic Research Center

• Dr. Murat Arik, Associate Director
• Sally Govan, Publications Editor
• Kitty Kulp, Administrative Assistant
• Xiaojaun Wang, Graduate Research Associate
• Christian Nsiah, Graduate Research Associate
• Jonathan Bass, Graduate Research Assistant
• Mitchell Caulder, Undergraduate Researcher

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