Knoxville Area Military Generate $1.8 Billion in Annual Economic Impact

Knoxville area military installations and activities generate an estimated $1.8 billion in economic impact each year, according to a study conducted by the East Tennessee Military Affairs Council (ETMAC) in cooperation with the Knoxville Chamber.

May 11, 2017

Knoxville area military installations and activities generate an estimated $1.8 billion in economic impact each year, according to a study conducted by the East Tennessee Military Affairs Council (ETMAC) in cooperation with the Knoxville Chamber. The new data, collected over the last year, updates the 2014 results which showed an impact of $943.3 million.

The study calculated the monetary impact of the active duty, guard, and reserve components of the
U.S. Air Force, Army, Navy, and Marine Corps. The study takes into account the annual payroll of active duty, guard, reserve, and civilian personnel; expenditures for construction, supplies, services and materials; indirect jobs resulting from military personnel; and military contracts given to area businesses and other factors like retirees’ pay and veterans’ benefits.

“ETMAC completes this economic analysis to provide business and civic leaders a complete picture of the significant contribution that the military and defense programs make to the economy of East Tennessee,” said Major Stephanie McKeen, TN ANG and president of ETMAC. “Because the military is one of the major drivers of economic activity in our area, our hope is that business and civic leaders will consider policies and actions that support and help retain this valuable resource in East Tennessee.”

Individual areas of economic impact measured for the 2016 fiscal year are:

Veterans’ Benefits $655M
Active Duty/Guard/Reserves $299M
Dept. of Defense Contracts $467M
Military Retirees $436M

Total: $1.8 Billion

The analysis uses the U.S. Department of Defense methodology to measure activity within 50 miles of Knoxville. The largest installations from an economic standpoint were McGhee Tyson Air National Guard Base and the 278th Armored Cavalry Regiment, Army Reserve. Also, more than 9,600 military retirees live within the 50-mile radius. Several organizations rank Tennessee in the “top ten” most desirable places for military retirees, based on such factors as the state's cost of living, taxes imposed by the state, city, and county, the availability of military base and veteran’s administration facilities, primary care facilities, dentists, shopping stores, banking services, senior citizen services, as well as having a variety of recreational activities.
“It is always important to recognize and honor the contributions of our local military units,” said McKeen. “We hope this analysis will encourage local businesses to take special care of the many men and women who serve our country, and recognize how important they are to our national defense, as well as our local economy.”

For a detailed explanation of the Military Economic Impact Report, please visit ETMAC’s website at www.etmac.org.