Overview
During the Tennessee Competitiveness Conversation, attendees heard from experts on a variety of topics—spanning advanced mobility; the future of energy supply, security, and innovation; the renaissance of advanced manufacturing, from R&D, to design, to production; and the growing talent challenges and opportunities facing Tennessee. This final panel tied together the two-day summit, examining the enabling conditions essential for Tennessee to remain competitive over the next quarter century. As the state plans for its future, it is critical to understand the factors at the intersection of policy, infrastructure, education, innovation, energy, and workforce development propelling Tennessee forward.
Key Session Insights
President and CEO of the Council on Competitiveness, Deborah Wince-Smith, moderated the concluding leadership panel of the Competitiveness Conversation: Tennessee, focusing on the future of the state and the factors needed to maintain its competitive edge over the next quarter century. Given the gravity of the talent challenge in supporting innovation, she began the discussion there.
How significant is the shortage of technology workers? A 2023 Semiconductor Industry Association (SIA) study titled “Chipping Away” projects that by 2030, there will be 3.85 million new jobs in the United States requiring technical proficiency, with 1.4 million of these positions at risk of going unfilled without an expanded pipeline of skilled technicians, engineers, and computer scientists. This trend is evident in Tennessee, as well. Randy Boyd, President of the University of Tennessee System, noted that “Over the last 10 years, Tennessee has created 361,000 new jobs requiring a four-year degree. We've faced shortages of 10,000 engineers, 2,000 nurses, and 2,000 teachers. We desperately need to produce the talent that our four-year schools, like those in the University of Tennessee system, can provide.”
“We heard why place matters so much: geography, history. But it is also about people, potential, purpose, possibilities, partnerships, and the Tennessee Promise going forward.”
Deborah Wince-Smith
President and CEO, Council on Competitiveness
Ms. Wince-Smith asked President Boyd to discuss the challenges of filling the talent pipeline and the broader issues facing higher education in Tennessee and across the nation. Provocatively, President Boyd pointed out there is no place with a pool of untapped talent ready to come work for a new business. So, to attract investment and businesses, regions need to invest in a strong community. Higher education is a critical part of that community, and not just for high-tech workers, but also to train the teachers and other critical knowledge workers who shape communities.
World-class institutions that help mold talent fit for the innovation economy attracts investment and businesses from outside the state, too. Tennessee has three R1 research universities, the highest research designation in the country given to about 130 institutions; these include the University of Memphis, Vanderbilt University, the University of Tennessee, Knoxville, the flagship in the University of Tennessee system. Expanding these universities and their number of graduates, particularly in STEM fields, will fuel regional innovation. For example, while Tennessee’s manufacturing sector has grown, much of the design work occurs elsewhere. Increasing local talent could shift more of this work to the state, enhancing its innovation capacity and growing the state’s economy.
“For Tennessee to continue to grow, it is going to need more talent, and the best source of talent is our higher education institutions across our state. If we are a baseball team, it is great to bring in free agents. But you also want to have a good farm club. You want to have great talent production within your state, and it is up to our universities to be able to do that.”
Randy Boyd
President, University of Tennessee System
The panel also underscored the importance of the collaborative spirit among leaders, institutions, sectors, and regions across Tennessee. One specific partnership was highlighted as exemplary by University of Tennessee, Knoxville Chancellor Donde Plowman: the University of Tennessee-Oak Ridge Innovation Institute, or UT-ORII. This collaborative organization is a partnership between the two research institutions with plans to recruit more than 100 new UT and ORNL joint research faculty and 500 research graduate students by 2030 to strengthen the talent pipeline in areas of growing national need and demand. The institute is positioning Tennessee as the “go-to” destination for top-level talent development and discovery, and it addresses emerging industry and workforce priorities. Through the exchange between the two institutions, students are prepared to innovate and solve complex problems across disciplines.
“Ultimately, the question I always like to ask business leaders is: ‘Why did you choose Tennessee? What ultimately was the deciding factor?’ And every time it is the same answer: the people.”
Stuart McWhorter
Commissioner, Tennessee Department of Economic and Community Development
Another critical strength of Tennessee is the fiscal discipline and the strength of its balance sheet. According to Stuart McWhorter, Commissioner of the Tennessee Department of Economic and Community Development, Tennessee maintains the second lowest debt burden per capita in the country. This has led to a top credit rating for the state and the financial resilience to weather unexpected storms. However, while financial prudence is laudable, President Boyd, who formerly held the same position as Commissioner McWhorter, asked the audience to consider whether having the second lowest debt per capita is ideal. While he described the idea as “heresy,” he wondered aloud what opportunities the state could create if it took on more debt, particularly for bolstering the state’s educational institutions and workforce development and without weakening its financial position. President Boyd noted there is plenty of need for investment across Tennessee, including a $7 billion need to support education alone.
A concluding discussion point turned to the state’s identity. According to the panel,Tennessee has not, historically, been the center of high-tech manufacturing, research, and education in the United States. Despite the presence of flagship institutions like Oak Ridge National Laboratory, that title has traditionally belonged to hubs in the Northeast or on the West Coast. But today, Tennessee is rapidly becoming a top destination for innovators, a position that has not changed the state’s culture and identity in major ways. The panel wondered if maybe it should.
“I think the combination of already being a great destination for talent and now preparing to be a leader in the nation’s innovation economy will determine Tennessee’s future.”
Daniel Diermeier
Chancellor, Vanderbilt University
Those institutions that have not changed are being caught flatfooted and unable to take full advantage of the sudden increase of investment, interest, and progress happening across Tennessee. For example, colleges within the state are seeing spikes in applications and enrollment; according to Vanderbilt Chancellor Daniel Diermeier, the school’s biggest market is now New York, and the acceptance rate has crashed to 6 percent to cope with the influx. Similarly, University of Tennessee, Knoxville Chancellor Donde Plowman shared her personal motto for her university: “We need to become the university we are becoming.” New infrastructure, students, research, partnerships, and scale will inevitably alter the identity of the institutions; harnessing that change will be the difference between success or failure.
“And I tell the students all the time: ‘There is a lot we need to fix in this world. So we, the University, need to work with you, to help you graduate and deploy your restorative strengths to build a new world.’ That is how I think about our role in creating a stronger, more innovative Tennessee. Tennessee is an optimistic state, and there is a lot of reason for hope.”
Donde Plowman
Chancellor, University of Tennessee, Knoxville
Conclusion
After an impactful and successful two days mapping the challenges and opportunities facing the state, the co-chairs of this debut edition in the “Competitiveness Conversations Across America” series committed not only to stay the course and build on Tennessee’s tremendous successes but to reconvene in three years to assess the evolution of Tennessee’s vibrant innovation ecosystem.
