Tennessee’s Promise: From Research to Policy

by Benjamin Robinson

Earlier this month, Tennessee Governor Bill Haslam delivered his State of the State address announcing a bold new initiative called the Tennessee Promise. The Tennessee Promise will funnel untapped funds in the state’s lottery coffers to make two years of public community college and technical education free to all residents. This proposal met with bipartisan support from lawmakers in Tennessee’s State Legislature but this idea is not a new one. In the past, the state of California’s community and technical colleges had been free of charge until budget pressures forced fees to be levied. What makes this policy shift unique is not just that it is occurring in a Southern state with a Republican dominated legislature but that it is occurring at the same time that Tennessee is experiencing a revival in its auto-manufacturing business. In the past the automotive sector was almost completely dominated by Michigan, Ohio, and Indiana, but that story has changed in recent decades. More and more, the automotive industry’s production and supply chain facilities have been moving south as firms are swayed to locate in Tennessee, Kentucky, and Georgia thanks to access to shipping networks, financial incentives, restrictive labor laws, and business-friendly tax and regulatory environments. In Tennessee specifically, Toyota, Volkswagen, and BMW all have facilities in the state while its “long” supply chain represents a larger share of auto-industry related manufacturing than factory workers, making this element of production even more valuable.

Recognizing the auto industry as one of his state’s major strengths, Governor Haslam made one of the priorities of his administration to build on the auto-industry and work to increase Tennessee’s competitiveness in the economic landscape of advanced manufacturing. As a former mayor of the City of Knoxville and a partner in his family’s business, Governor Haslam understood the importance of targeted investment in education in creating a successful foundation from which to improve not just the auto industry but the Tennessee economy as a whole for the long term. Advanced industries are research and development intensive industries that concentrate science, technology, engineering, math, and computer workforce and involve the full spectrum of industries from advanced machinery and computer/electronic devices to telecommunications and software. The share of overall private sector workers employed in the advanced industry sector is only about 6% but they account for a whopping 80% of private sector research and development. By developing an industry that punches above its weight, Tennessee is betting that advanced industries and automotive manufacturing are the keys to a platform of innovation and growth by driving productivity in other industries, supporting the growth of a long supply chain, and stimulating local economies. However, this platform cannot be fully engaged without a skilled workforce and collaboration among industry to push for smart forward-thinking policies and programs that will power Tennessee into the future.

When I first walked into the offices of the Brookings Institution as summer research intern, I knew very little about automobile manufacturing or advanced industries. What I did know about was workforce development, the field of work focused on building skills through education and training while creating pathways to jobs based on those skills. The previous summer I had been hired as a youth research consultant for the local workforce investment board, a public agency that disperses funds on a local area and administers workforce development programs and partnerships, in my hometown of Cincinnati, Ohio to evaluate the performance of the last program cycle of their youth programs. That experience had led me to being brought on by Martha Ross, a fellow in the Metropolitan Policy Program (one of 4 main programs at Brookings, which also include Governance Studies, Economics Studies, and Foreign Policy) and an expert in local workforce development policies with an extensive background on issues effecting Washington, DC and the Greater Capitol region, and Mark Muro, one of the Metropolitan Policy Program’s senior fellows and policy directors who sets the agenda for the program’s research on innovation, technology, and regional economic development. The main project I would be working with them as well as about a dozen other researchers and interns across the Metro program was a report about strengthening Tennessee’s auto industry and I would be assisting Martha Ross on the workforce development sections of the report through data analysis/visualization as well as literature reviews of workforce development model partnerships for advanced manufacturing from around the country. At the end of the summer, after ten weeks at Brookings, the team had finished the large majority of the work for the report and we were just waiting for the green light from Governor Haslam to release our findings at his Tennessee Economic Forum meeting in October.

Fast forward to February 22nd and the report—Drive!: Moving Tennessee’s Automotive Sector Up the Value Chain—has been out for months and Governor Haslam and Colorado Governor John Hickenlooper are panelists at an event at Brookings about the importance of advanced industries and manufacturing. Haslam has been under fire in recent weeks for potentially influencing a vote to authorize the United Auto Workers to form a union at Volkswagen’s Chattanooga facility by warning that it would set a bad precedent for future state-related business dealings and discourage investment in Tennessee. However, because a labor union is essential to the creation of a German style labor council, an organizational group of workers, management, and public officials that manage labor relations at the plant, this action may backfire. Bipartisan and future-oriented nature of policies like the Tennessee Promise offer hope for Tennessee as a state that invests in the human capital of its citizens and reorganizes public initiatives around a high-growth vision of its economic future. I cannot say that our work directly influenced Governor Haslam to make the Tennessee Promise, but I would like to think that in some way, our work was able to inform policy decisions around a consensus on what will work for the people of Tennessee.

Relevant Links:
Tennessee Governor Urges 2 Free Years of Community College and Technical School, by Richard Pèrez-Peña (Feb 4, 2014 The New York Times)
Volkswagen Vote Is Defeat for Labor in South, by Steven Greenhouse (Feb 14, 2014 The New York Times)
Drive! Moving Tennessee’s Automotive Sector Up the Value Chain, By: Mark Muro, Scott Andes, Kenan Fikri, Martha Ross, Jessica A. Lee, Neil G. Ruiz and Nick Marchio (Oct 4, 2013 Brookings Institution)
Powering Advanced Industries: A Bipartisan Dialogue on State Strategies (Feb 20, 2014 Brookings Institution)