We create a battery belt spetchy from Michigan to Georgia.
In Chester County, South Carolina.
We've all heard about the Biden administration's push to bring back American manufacturing and create jobs, especially in technology like microchips, renewable energy, and of course electric vehicles. The hundreds of billions of dollars that will flow into those industries over the next few years are accelerating the growth of what's now being called the battery belt. Across the southeastern US.
Echoes there to the Midwestern rust Belt, the old center of steel production and other heavy industry in the last centri Next there's the Sun Belt, the russ Belt, now the battery Belt.
The hope to turn the Roust Belt into a Pan American battery belt before the next election.
So how will all this money be spent? To find out, Bloomberg's Mackenzie Hawkins and Reed Pickert took a close look at Tennessee. It's a state that's trying hard to attract companies. And here's the hard part. Quickly find and train thousands of workers to fill these positions, some requiring all new skills.
They told me that they put out a coloring book about the trades and are trying to push that in elementary school libraries.
They have people flooding into the state, and employers will follow where those people are.
And we'll hear from workers who are going back to school to future proof their careers.
I wanted to know the ins and outs. I wanted to learn how to repair or design at a given point maybe, and I didn't think that that was going to actually be possible at my age.
I'm west Kosova today on the big take, how the battery belt is being built? Mackenzie, I think we're all familiar with the Rust Belt, which was the manufacturing belt of America for many decades. Why is the battery belt in the South.
I mean, you're generally seeing a sort of migration of the US economy towards the southeast. A lot of wealth is moving there, a lot of people are moving there. So it's not entirely surprising that we're seeing a concentration in additional to the traditional industrial Midwest, also in states like Kentucky and Tennessee and Georgia. And there are of course a lot of factors at play. You know, One
is you want already supply of people. Two is factories need Land, and so you're not going to see them popping up in urban cores like New York or DC or San Francisco. Some folks have also pointed to the South having you know, right to work states, so car manufacturers that don't necessarily want to deal with labor union negotiations that will be more present in parts of the Midwest.
And it's important to note that you're also seeing you know, battery investment happening in our parts of the country like Texas and Nevada.
Something that Tennessee has done really well for a long time now is trying to think about their future workforce. And so when thinking about their future workforce, you know, back in the mid twenty tens, they thought, okay, so what is the best way that we can prepare our workforce at the future by educating them in the skills
that we think they'll need. And so they announced something known as Tennessee Promise, which allowed for new high school graduates to go to community college or technical school for free. Around the same time, that was expanded to also include adults of all ages as well, so virtually every adult
in the state could get this free technical education. The true kind of first example of this partnership between the technical schools or the Tennessee College of Applied Technology and companies was with this Nissan facility right outside of Nashville.
McKenzie, You went down to Tennessee and you talk to a lot of people both who run teacat this school and the students, and what did they tell you?
So this TEACAT campus in Smyrna, which is, you know, about half an hour outside of Nashville, is a really interesting example within a broader two dozen campus system because it's an offshoot of an existing teacat that Nissan actually helped fund itself to provide a specific pipeline of workers to the plant and also to bring in a lot of tech and tools and machinery to allow students to learn trades like welding, trades like industrial electrical maintenance, machine
tool technology. And so you have a bunch of students, some of whom are current Nissan employees, some of whom are on track to become Nissan employees, and a lot of whom are just sort of traditional TEACAT students learning the trades using pretty high tech, twenty first century technology.
But getting that message out there is probably the biggest struggle for Nissan and for college administrators, because that's not what you think of when you think of a factory, and what they're trying to promote is that this is a clean, high tech and twenty first century career.
And read that's a really important thing, I think, because one of the things that stood out to me in your story is just how few Americans these days are in manufacturing positions.
Absolutely, Manufacturing has gone from about sixteen percent of the workforce at the start of the nineteen nineties to just eight percent now. And so you know, part of the struggle in terms of trying to convince young people to take these jobs and invest in their education for this type of jobs is when you look around and you see other adults in your life, you see the case
that these jobs have been shrinking for decades. So encouraging people to invest in this and promising that these jobs are now going to be increasing in the future and that there is need there can be quite difficult.
And mc kenzie. Another thing you write is that that's especially true for younger people who are kind of raised digitally and now they're trying to be persuaded to work with their hands definitely.
I mean, one of the kind of consistent themes, particularly in the younger students that I talk to on the ground in Tennessee, is they're not being encouraged to pursue the trades. The message that's been you know, in some cases kind of forced down the typical middle school or in high schooler's throat is the pathway to success in America is a four year university degree, and if not
that community college. And now, when you have a pretty robust labor market and you can make a decent living wage in some parts of Tennessee, and you know parts across the US working a sort of traditional service industry job, the idea of industrial education to pursue a career path that's been on decline in America for decades is not
particularly appealing. And so the eighteen and nineteen year olds who have made their way to teacot are often doing so after being pushed by their parents, or by their guidance counselors, or by their teachers or by their friends to what's been sort of presented as the dogma for success.
Read you said earlier, how Tennessee's been at this for quite a while, but now they're really making a new push to bring even more jobs into the state to create the kind of manufacturing base that McKenzie's talking about.
I think that.
You've seen Tennessee attract a lot of jobs across the board, and so I think it's really benefited from this kind of boom of the South, and Nashville in particular has really been this boom town that when economists look at cities that things are going well for, Nashville is often one that they point to because you have seen this influx of tech jobs, this influx of finance jobs, and
really this diversification of the economy. And I think what this really speaks to is the fact that, like a lot of states in the United States, Tennessee saw more deaths than verse in twenty twenty two, and that could be a real problem for the state in terms of thinking about growing its workforce, in terms of growing industry. But what they do have is they have people flooding into the state. So because of the jobs that are there, because of the relative affordability and the good weather. I'm
from Tennessee myself. They instead had, you know, a net around eighty one thousand people pour in from other states into Tennessee and employers will follow where those people are. And while the state is certainly welcoming all of these new people with open arms, you know, officials did emphasize that the priority is to make sure that Tennesseeans are
getting these types of jobs. And then from the perspective of manufacturers, you know, the state has a lot to offer, and especially when the state can offer you these pretty substantial incentive packages and are offering and putting on the table, will build a teacat on your property to drain your people for you.
Tennessee's been in the subsidy game for a while. I mean the breaks that they gave tax breaks, land use breaks, you know, water subsidies, and of course an actual technical college for this Ford plant that's opening outside of Memphis total around two point four billion dollars. And this is not just happening in Ford. Of course. Teacat is a form of subsidy for any employer and parts supplier that's interested in moving to the state and wants a ready
supply of trained workers. And Tennessee is primed to pour nearly a billion dollars into the TACAS system writ large to update existing campuses open new campuses and make it possible for any sort of industry expert, any employer to turn to their local teacat and say, hey, I need to train X number of people with X specific skills.
Can you turn that around for me? And when I talked to this person who's their title is the special Industry Coordinator at the teacat in Murphy's Borough, that person's entire job is being the point of contact for local industry and he says he's worked with upwards of one hundred companies over the past couple of years just in
that area. I'm right outside of Nashville. And if a company says, hey, I need X number of workers trained in a couple of weeks, they can start that training program tomorrow because they're in many cases adding a couple of skills here, or they are fine tuning it to
the specific company needs. And that, of course, is a legitimate form of subsidy that the state is trying to use to draw more employers in during this sort of national manufacturing push where every state is competing to get a piece of the pie.
I mean, it is pretty revolutionary to offer free technical education for nearly every adult in your state. And I think Tennessee was very much at the forefront of this. But one thing that I find really interesting is when I originally did a story on this topic. More generally, it was during the time of the Democratic primaries, where several of the can we're talking about these potentials for free college initiatives and free community college, and they were
all being talked about by Democrats. And here's Tennessee, that's a deeply read state with a program that is very popular across the.
State, government funded.
Government funded, Republicans supported. A Republican governor is the one who came up with this idea and pushed it all the way through. And I think it also really shows you that people can get on board with these things that are really helping to build up the middle class and provide an opportunity in a path to these kinds of jobs.
Mcken's we've been talking a lot about state investments and investments from companies, but there's also a ton of federal money from the Biden administration going into this.
So you're seeing hundreds of billions of dollars in federal investment, not just going to subsidize the electric vehicle and battery industry, but also clean energy, semiconductor ships, and traditional hard infrastructure, and that's being matched by an explosion of private capital going into these states and the electric car industry. You're seeing over one hundred billion dollars in recent years. Tennessee itself has garnered more than sixteen billion dollars since twenty
seventeen in electric vehicle investments. You're starting to see the beginnings now of federal money flowing into states that are very quickly trying to leap up and get carveouts for major projects, and that's one of the things that is causing and generating this battery belt. So you know, Tennessee was in on this game a while before. You saw the Inflation Reduction Act provide massive substies to the electric
vehicle industry. But there's no doubt that the federal investment and incentives are going to dramatically ramp up this trend. And it'll be really interesting to watch where in the
US this money is concentrated. Of course, in the case of evs and batteries, we're seeing a concentration from Michigan to Georgia, including both the sort of traditional industrial Midwest and also in it explosion of ev and battery industry in the southeast, of course, somewhat ironically, because these are states that you not necessarily would expect to be latching onto sort of a green energy future going through a very red part of the US.
After the break, we hear from people who are taking advantage of these new training programs. McKenzie. So we've now heard how they've created all these jobs. How are the companies finding all these people they need to fill them.
I had a conversation with a Nissan executive in charge of workforce development, and he said, if we were going to high schools before we're going to middle schools now. I mean, the general thesis is the pipeline just needs to be starting earlier and earlier and earlier. Sat By the time they get to high school and they have the classroom visits that these companies have been doing for a while, that isn't the first time they're being introduced to the idea of the trades as a viable career path.
So you're seeing a doubling down on the classroom visit strategy. But you're also seeing some innovation from folks at the Tennessee Board of Regents, which is the kind of body that oversees public higher education in the States. They told me that they put out a coloring book about teacat and about the trades and are trying to push that
in elementary school libraries. They have a bus that they're driving around to middle school science fairs where kids can come try out augmented reality welding and you know, try to troubleshoot a hydraulic power switchboard. Things that I mean, words that don't even mean anything to kids in a lot of places who have been learning about coding and you're hearing about Python and Java, you're not hearing about
stick welding. And they're trying to sort of change that paradigm through marketing strategies that are engaged in a really uphill battle.
Another great example is what Volkswagen has been doing in this date. And they're in Chattanooga, which is in the far east part of the state, and they have essentially kind of taken this multi prong approach to trying to get kids in the area excited about manufacturing. They've put digital fabrication studios in K through twelve schools so that kids can learn hands on types of manufacturing things high school juniors and seniors can actually take classes at the
Volkswagen plant at their Megatronics academy. The county schools have gotten totally on board with this manufacturing initiative, and then that even carries on past that with Volkswagen has then partnered with a local community college to do apprentice at ships and really blends that classroom and hands on experience.
You know, as someone who grew up going to Tennessee public schools myself, I never heard anything about these high tech manufacturing careers and so the idea that they're starting children so young and showing these paths is something that's really new and different.
McKenzie. We were talking a lot about trying to persuade young people, but you spoke to a lot of people in Tennessee who are going through these schools through the teacat program, and they're really diverse group of people, and not all of them are.
Young, definitely. So the average age of the campus that I visited is twenty six, and administrators are trying to bring that age down because they're really focused on the future pipeline for these jobs and they're seeing some success statewide, you know, whereas broader adult enrollment in the TEACAS system
has flatlined over the past five or so years. High school dual enrollment has nearly tripled since twenty sixteen, and so they are really targeting those younger folks, but you are also seeing a large share of students who are older adults, perhaps pursuing higher education for the first time, in some cases coming back after getting a bachelor's degree that they haven't found especially useful in aligning with their career ambitions, or they're sort of looking at the local
job market and saying, this is where the jobs are, I should probably get certified in a way that's relevant to these jobs. Just as kind of an example of the diversity that we see in the types of students that are enrolling. I talked to a young woman named
yeralin res Garcia. She learned about the TEACT through her brother in law, and that's kind of a common theme that I heard among the young people that I spoke to, that they weren't hearing about teacat through their high school guidance counselors or the teachers who will have them sit in class and throughout a college application, but rather through word of mouth, which of course is a great marketing tactic, but you can't build an entire industrial workforce just via.
Word of mouth.
But also sort of highlighted the challenges in pursuing a Teacot education even when you have basically a tuition free ride towards a certificate via Tennessee Promise and Tennessee Reconnect. She works in a daycare after school to pay for gas and food, so she's a full time student also basically a full time worker. One of the most interesting elements I talked to her about, you know, going to
a welding class. She's one of the only girls in class, and she says that when she talks to people at her daycare job about Teacat and says, this is great. You know, I'm going to school for free. I am wearing all this cool gear. I'm like lighting fire sticks of metal. They're just not interested in what they call
guide jobs. She doesn't seem especially bothered by that, And I talk to a couple of other female students while I was there who say that they feel like for them, the sort of idea of manufacturing as a hyper masculine field is changing. But the reality is, of course that the distribution of students that you see in these classes is overwhelmingly male. I also talk to a man named
Pierre Reid. He's fifty six and he's studying Industrial electrical maintenance, which basically will give MERC certificate that qualifies him for a job repairing machines in any typical factory. And for him this was actually coming out of years of working in manufacturing but not having a ton of opportunity to progress.
I can't go any higher in that building unless the boss leaves. By attending TEACAT, a whole new world just opened up.
He's spent his life in a variety of careers military, warehousing, farming, manufacturing, and now he works in the steel industry. And after a nine and a half hour shift cutting and lifting steel, he comes to Teacat because he wants to learn about the machines that he's running at his steel plant job.
I wanted to know the engine out, so I wanted to learn how to repair or design at a given point maybe, And I didn't think that that was going to actually be possible at my age.
And that's what I heard from a lot of folks who are later on in their careers that they've had exposure to these industries in a manufacturing job, but without the career advancement that a credential could provide them.
Now, I love what I do playing with still cut and steal shape for mo fabricate, learning how the machine works to do that. TK shows that I can learn that here.
The idea of the battery belt is not new. Nissan, which partnered in twenty seventeen with the Teacat to open this campus, began producing its Leaf electric cars in twenty eleven in Tennessee. And one of the students that I spoke to has actually been on that factory floor in Nissan, participating in this electric vehicle revolution before it really became
a revolution. His name is Richard Lambert. He's thirty seven, and he's worked for the past decade or so as a stamper in the Nissan plant, which basically means he's fitting these large sheets of metal for car doors and fenders to molds that eventually produce a frame.
At the while that specific job that I was on kind of just start feeling like a robot.
And he got into this work study program that Nissan began offering last year as one of eight out of more than one hundred applicants to have the opportunity to go to school and learn how to do more machine tool technology to allow him to move to what's called the tool and die department, where basically he's going to be the one designing and repairing the molds that in the past he's been putting these big sheets of metal on. And Nissan's paying you to be here.
Yeah, they're giving me my forty hour salary to be here, and they're paying for the schooling. Was good, gay I said, what works out?
So it's a pathway that he described as really difficult to accomplish within the fact itself, but by going and earning this credential, he's effectively guaranteed that job and a ten dollars an hour raise that comes with it when he completes the credential that he's being paid his normal wage.
To do it'd be really hard, especially for me being married and having kids at schoolwork and everything else. It would have been been a huge pain. So this program actually worked out very well for me.
Obviously.
Another part of this is allowing people not fresh out of high school to go for these types of jobs, and when thinking about Tennessee as a state. It has one of the lowest workforce participation rates in the country, and so there's a lot of people on the sidelines
that could be going for these types of jobs. And you know, one conversation that I had with a Memphis official made it clear, you know, how this is certainly not lost on them that they have a urban core that is lower income, disproportionately people of color, and how how do we find a way for those people to get these good jobs, to help these locals skill up
for these jobs. You know, city officials plan to open a one hundred and four thousand square foot skills training center in Memphis that will offer services like transportation and daycare, all of this for free. And so when we think about the types of obstacles that we hear from folks on why they can't have a job, a lot of times it's because there wasn't reliable public transportation to get there, they didn't have a car. It may be that kids were out of school and so they missed too many shifts.
And so anything that can be done to kind of give these wrap around services to folks and really offer that opportunity, I think it's not lost on officials that they need to do that type of thing as well.
You know, one thing that you notice when you walked into a TEACA campus and into a typical factory floor is that the manufacturing workforce in Tennessee is largely white. And so there's kind of these parallel efforts going on to change the idea of who can be a manufacturer and what it looks like for an influx of jobs
to serve the entire community. How to build the pipeline in a way that's sustainable and gets folks into these really high paying quality jobs without continuing to leave some communities behind.
When we come back, will Tennessee be able to find enough workers to meet the demands of the future. To read, When the students come out of these programs, what can they expect to earn? Is there a big payoff at the end.
So we don't have a ton of data ourselves, but one teacat instructor said, at least for his graduates, they leave with a starting salary of between forty thousand and sixty five thousand dollars a year, with the idea and the opportunity to go much higher from that, but with no student debt and a job placed rate of one hundred percent. But I think when we think about these manufacturing salaries, it's important to think about the job market
that we're in currently. Unemployment is quite low across the country. It's nearly a record low in Tennessee. And so you've also seen kind of hourly jobs places like BUCkies. I'm not sure if you're familiar, but a large gas station chain offering much higher hourly wages than you typically would in the past. People can go right out of high school and go earn that money without any training whatsoever.
It's this really tough competition between Okay, do I take two years to invest in myself and go learn these skills for this job, or do I jump into the job market now while it's hot and try to earn as much money as I can. But what will be interesting is as the economy moves forward and it either does or doesn't fall in recession or as the labor market slows, what happens in terms of the the stability and safety of those jobs. From the perspective of these
hourly jobs. Just thinking of Tennessee, overall government data shows us that in twenty twenty two, the annual mean wage was around fifty two thousand, eight hundred and twenty dollars. So write smack dab in the middle of that range that this particular TEACAT instructor was talking about. But when we think about that, that number includes a lot of very high wage jobs in the state as well as
lower wage jobs in the state. So when you're comparing these manufacturing jobs, say to a food service job where you might make between twenty five thousand and thirty five thousand dollars a year, this is a job that would not only give you more money, but perhaps more of
the opportunity to advance than a job like that. But I will note you know, that type of salary range is not like you're coming in and you're making the big bucks immediately, and I think that that's important to keep in mind when thinking about the payoff of these types of programs.
But I will say what I generally heard from instructors and students at the teacos is that if your starting salary is kind of smack dab where the average salary is that you can earn in Tennessee, and everyone from the White House on down is saying, hey, we actually are bringing manufacturing back. This is a career that can be long and can be stable. It's an attractive long
term offer. The way that folks in Tennessee like to phrase it is you're taking a bit on yourself, not to get a job, but to start a career.
So read, they put this huge program in place, how's it working. How many students are they attracting now? And is it enough to fill out the need of all these manufacturers moving in.
It's not quite enough to fill the need, and I think that they're aware of that. But where you've seen a lot of this growth is in this kind of dual enrollment of getting students in high school excited about these programs and signing up for them. But when it comes to adult enrollment, you've seen that broadly kind of
flatline for the last couple of years. So you know, when thinking about the future, you really not only need to see this consistency, but you really do need to see this growth, especially as this state attracts more and more manufacturers to Tennessee.
So a big challenge and a lot of money behind it. What are you looking for is you continue to report on this story, not just in Tennessee, but across this growing battery belt if it works.
I mean, I think, you know, our headline really captures this of you know, the US is building more factories, are we going to have enough workers to fill them? And I think what we're seeing across different states. You know, Tennessee was early on this trend and got a head start, but everyone's starting to catch up with them, and you're starting to see this offer of will help you train your workers from governments as they try to convince employers
to come to their states. We're starting to see that more and so it'll be interesting to see if that helps this problem, especially in the United States that's already struggling with some demographic issues and concerns about longer work shortages, whether these types of investments are enough to prevent this particular industry from seeing long standing worker shortages.
Reed Mackenzie, thanks so much for coming on.
The show, Thanks for having me, thanks for having.
Us, Thanks for listening to us here at the Big Take. It's a daily podcast from Bloomberg and iHeartRadio. For more shows from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen, and we'd love to hear from you. Email us questions or comments to Big Take at Bloomberg dot Net. The supervising producer of The Big Take is Vicky Virgalina. Our senior producer is Katherine Fink. Rebecca Shasson is our producer. Our associate producer is Sam Gabauer. Raphael M.
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