The overall economic outlook in the Tennessee Valley looks favorable for value-added agriculture, aquaculture and forest industries.

“The market looks good for agricultural products in Tennessee because stable manufacturing provides Tennesseans with jobs, populations are increasing, export channels are developing and retail trade is growing,” said Rob Holland with the Agricultural Development Center at The
University of Tennessee.

The Tennessee Valley Authority’s Department of Economic Development recently published a comprehensive analysis of economic trends and prospects for the Tennessee Valley and its industries.

The report indicated that 29 percent of the valley’s gross product is generated by manufacturing firms that locate here to take advantage of Tennessee’s central and convenient location to markets; convenient transportation system; low-wage workforce; and abundant, low-cost
resources.

“Longer term, however,” Holland said, “the region’s recent manufacturing growth is expected to slow as the state’s auto industry matures and apparel jobs diminish. As the region’s manufacturing role stabilizes, the service sector and overall population are expected to fuel growth.”

Compared to the national average, electric rates in the region are expected to remain relatively low. “This will please the valley’s manufacturing sector, but won’t lead to substantial growth in the sector,” said Holland. “The region will continue to be strongly dependent on the manufacturing sector. But manufacturing won’t be the primary ‘engine of economic growth’ in the long term.”

The valley’s commercial sector, stronger-than-national population growth and rising tourism will likely be the primary source of economic momentum, he said.

Since 1960 the Tennessee Valley has gained a large share of the nation’s food industry. While most food-processing firms serve primarily local and regional markets, distilleries and poultry processors are finding success in export markets. This may pave the way for other Tennessee
exports, Holland said.

Residential construction in the region will cause growth in the furniture and fixtures industry in the region, Holland said. More home offices, more home-entertainment centers, more home remodeling and more homeowners are expected to cause the region’s furniture industry to outperform the national average.

Moderate growth in the valley’s wholesale and retail sector is expected in the longer term.

Tourism, particularly outlet shopping, should enhance the region’s trade sector above the national growth as well, he said