Tennessee’s economic development leaders are nudging their focus toward attracting research and development business as job growth slows in manufacturing, one of the state’s largest industries.
Manufacturing sector employment in the United States has fallen sharply in the past 40 years, dropping from about 21% of total U.S. employment in 1980 to about 8% by the end of 2024, according to the U.S. Bureau of Labor Statistics. While job shrinkage in Tennessee has been less drastic, the trend is similar.
“This industry is growing in terms of production, but it’s shrinking in terms of employment,” Celeste Carruthers, professor of labor economics at the University of Tennessee Haslam College of Business, told the Tennessee Lookout. Those patterns can be chalked up to advancements in technology, automation and robotics, in addition to offshoring manufacturing labor, she said.
Manufacturing had the highest gross domestic product of any industry in Tennessee in 2024, bringing in more than $68 billion. The industry employed 364,400 Tennesseans that year, federal data shows — a modest increase from the state’s pre-pandemic high of 355,600 manufacturing employees in 2019.
An annual state economic outlook report presented to Gov. Bill Lee by the University of Tennessee’s Boyd Center for Business and Economic Research projected that Tennessee manufacturing jobs will “remain flat or see modest increases” in the long term, while nationwide manufacturing jobs continue to shrink.