By the numbers* 52 - Number of commitments from foreign-owned businesses in Tennessee last year* 9,215- Number of jobs from new foreign-owned businesses in Tennessee last year* $1.68 billion - Capital investment last year from foreign-owned firms in Tennessee* 864 - Total number of foreign-based establishments in Tennessee* 116,000 - Number of Tennesseans employed by foreign-based companies* $30.1 billion - Capital investment from foreign-based companies in TennesseeSource: Tennessee Department of Economic and Community Development
Tennessee workers are taking on a growing foreign accent.
Nearly 40 percent of the new jobs recruited to the Volunteer State last year came from foreign companies. A new study released Friday ranked Tennessee as the number one state in the country for recruiting jobs from foreign-owned firms in 2013.
The study by IBM's global business services unit found that while foreign direct investment declined around the globe, the United States remained the world's top destination country with foreign investment jobs rising in 2013 by 6 percent.
With its central location, relatively low cost of living and history of foreign investment, Tennessee attracted the biggest number of jobs from foreign-based companies last year.
The Volunteer State recruited 52 foreign-based companies to the state in 2013 - including four in Hamilton County. Collectively, the new $1.68 billion of foreign direct investment last year in Tennessee is projected to add 9,215 jobs.
"We've tried to build on decades of success in recruiting foreign investment that Tennessee has enjoyed since former governor - now senator - Lamar Alexander first helped bring Nissan to Tennessee in the 1980s," Tennessee's chief economic recruiter, Bill Hagerty, said Friday."We've certainly dialed up that effort in recent years and we've gone around the globe to meet in person with business prospects to convince them of the advantages of Tennessee."
The number of foreign trade offices maintained by Hagerty's Department of Economic and Community Development has grown from four to six in the past three years. Hagerty, who speaks fluent Japanese and some German, worked around the globe as a business consultant, investor and manager prior to joining Gov. Bill Haslam's cabinet. Hagerty lived for three years in Tokyo as Senior Expatriate responsible for the Boston Consulting Group's international work in Japan.
"We try to offer a personal touch, but it's got to be built on real advantage and I think we have that in Tennessee," Hagerty said.
Most of the foreign direct investment in Tennessee is in manufacturing, including billion-dollar plus investments in the past couple of years by the Japanese-based Nissan in Smryna, the German-based Volkswagen in Chattanooga and the German-based Wacker Chemical in Charleston. The Swiss-based UBS also picked Nashville for a major back-office banking center.
The share of workers employed in manufacturing in Tennessee is 30 percent above the U.S. average. The state is located within a day's drive of more than half the U.S. population and wage and unionization rates in Tennessee are below the national average. That lowers the cost of manufacturing in Tennessee compared with most other states.
Tennessee has no coastal ports and limited international air service from Nashville and Memphis. But its central location "gives us a tremendous logistics advantage," Hagerty said.
The currency exchange rate that helped drive some of the influx of foreign investment into the United States is lessening, Hagerty said. But he said current and future foreign prospects give him confidence about the future.
The 2013 ranking by IBM was ahead of the announcement in July that VW will invest $600 million in Chattanooga as part of a $900 million expansion expected to add 2,000 direct jobs and thousands of other indirect jobs in Chattanooga.
Major foreign projects Tennessee last year included South Korean-owned Hankook Tire Co. (1,800 new jobs, $800 million investment), Japanese-owned Calsonic Kansei North America (1,200 new jobs, $109.6 capital investment) and Swiss-owned UBS (1,000 new jobs, $36.5 million capital investment).
"Tennessee is clearly an attractive place for foreign-owned companies to invest," Roel Spee, the global leader of IBM Plant Location International, said in a statement. "The state's first place ranking illustrates just how strong a competitor Tennessee is in the global marketplace and the momentum the state possesses in recruiting new foreign investment projects."
The Volunteer State is home to 864 foreign-based establishments that have invested over $30.1 billion in capital and employ more than 116,000 Tennesseans. The state's top 10 countries for investments include Japan, Germany, Canada, United Kingdom, South Korea, France, Italy, Switzerland, Sweden and Belgium.
Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340