Jul 13, 2023 - Business

Tennessee hits high mark in CNBC business ranking

Illustration of medal with a briefcase

Illustration: Eniola Odetunde/Axios

Tennessee vaulted to No. 3 in CNBC's 2023 Top State for Business, which was released this week.

  • The Volunteer State jumped up three spots since 2022.

Why it matters: The ranking is a bragging point for politicians as well as economic developers, who are already taking a victory lap. Responses from Gov. Bill Lee and the state's Department of Economic and Community Development suggest they will double down on the state's aggressive recruitment efforts.

What's happening: Tennessee has emerged as a leader in the manufacturing of electric vehicles and the technology that makes them run.

Zoom out: The rankings mirror recent news of the South's growing economic might. The only states to best Tennessee were North Carolina and Virginia.

Between the lines: The rankings gave high marks to Tennessee's infrastructure, tax rates and economy. The state's growing pool of educated workers also gave it a boost.

Yes, but: CNBC dinged Tennessee for "raging culture wars" that put it near the bottom of the list when it comes to quality of life, health and inclusion.

What we're watching: The Tennessee secretary of state's office reported new records for business formations and renewals during the first quarter of 2023.

  • The office said those numbers tend to drive job growth and state revenue.

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