Economic Impact of Business Development Projects
The Center for Economic Research in Tennessee (CERT) forecasts the economic impact that expansion and recruitment projects will have on the regional economy. The impacts of all projects receiving grant assistance are provided in the dashboard below, segmented by project year.
Economic impact is measured in terms of the total number of new jobs, new salaries, and new economic output that are projected to be created in the state over a ten-year period. Direct impacts reflect new jobs, salaries and economic output generated directly by the projects evaluated; and indirect impacts reflect new jobs, salaries and economic output generated in supplier networks. This activity induces additional economic activity in other industries of the economy (induced impacts).
The increased economic activity will generate new tax revenues for the State of Tennessee, which CERT forecasts over a 10-year period using this model. Fiscal benefits do take into consideration projections for tax credits that businesses may qualify for, as well as increased costs of providing state services.
TNECD evaluates state incentives against fiscal net benefits to forecast a rate of return on the state's investment and to estimate the number of years that it will take the state to recover the cost of incentives (payback period).
Source: Working with economic consulting firm Impact DataSource and the Tennessee Department of Revenue, CERT developed a model to forecast the potential impact of projects that apply for grant assistance. The dashboard is an evaluation of data produced by the model.
* Direct economic impacts are the jobs and payroll directly created by the projects. The economic impact analysis also calculates the indirect and induced impacts that result from the projects. Indirect jobs and salaries are created in new or existing area firms, such as maintenance companies and service firms, that may supply goods and services for the Project. In addition, induced jobs and salaries are created in new or existing local businesses, such as retail stores, gas stations, banks, restaurants, and service companies that may supply goods and services to new workers and their families.