2nd Quarter 2010

(Click on graph for larger view.)

average value of exports per firm


increase in tennessee exporters over the past decade

Expanding Exports II

The Number of Tennessee Exporters

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Increasing exports will rely on increasing exporters. A few large firms dominate the American export picture. The top 500 exporting firms account for 60% of the value of the nation's exports. Over two-thirds of America's exports come from firms that employ 500 or more people. But any serious effort to raise the level of exporting has to expand the number of firms that export.

Recent data shows that just under 7,000 Tennessee firms export. That number increased substantially over the past decade, and the state has half again as many exporters as it did in the late 1990s. This rate of increase well exceeded that of the nation. In this respect, Tennessee appears to be doing a good job in preparing the groundwork for sustained export growth. One lingering question of the crash of 2008, though, is how exporters or would-be exporters were affected by the economic downturn. The explosion of the tech bubble and ensuing recession of 2000-2001 led to a substantial drop in the number of firms that exported. Nearly 1,000 Tennessee firms left the export market, and the number of state exporters didn't return to the pre-recession level of 2000 until 2007. Will (or did) our current difficulties similarly drive exporters out of world markets? We don't yet have the data to know, but this is an important question in assessing the state's export capacity going forward.

One interesting sidelight in the pattern of Tennessee exporting is that the state's exporting establishments have made some progress in closing one significant performance gap. In 2000, the average Tennessee exporter shipped only 64% of the value of the average American exporter. In other words, state export operations were typically much smaller than their national counterparts. In 2008, this gap had shrunk, with state firms now at 80% of the national average. The average state firm is now shipping exports valued at about $3.16 million per year (a 63% increase from 10 years ago). Further closure of this gap will be another way for the state to increase its exports.

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