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***Note from The Tennessee Conservative – this article posted here for informational purposes only.
The Center Square [By Kim Jarrett] –
Tennessee’s tax revenue increased by 14.4% in May when compared to last year, and 25,000 new businesses filed with the secretary of state during the first quarter of 2026, according to the Quarterly Indicator report.
Tax revenues for fiscal year 2026, which ends June 30, are up 6.5% through May, according to the report released in partnership with the Boyd Center for Business and Economic Research at the University of Tennessee.
The new business filings represent a 20.6% increase compared with the first quarter of 2025, a new record, Secretary of State Tre Hargett said during a call with reporters. The number of annual reports filed also set a new record with a 30.4% increase over last year.
“Just when we thought things were slowing down a bit in terms of employment growth here in Tennessee, along comes this new report with record new establishment filings and an annual report filings,” said Dr. Don Bruce, director of the Boyd Center for Business and Economic Research at the University of Tennessee. “The number of news and ongoing businesses in Tennessee is back on the rise again in a very large way.”
The increase in business filings is twice what he would expect, state Rep. Ryan Williams, R-Cookeville, said in an interview with The Center Square.
“It’s that five to 25 person business that’s really starting out, that’s really making a way,” Williams said. “And for me, that’s really exciting because the horizon or the landscape is wrought with opportunity, because so many people see that opportunity now and they’re deciding to go into business for themselves. And it’s the small businesses that are really fueling the engine that makes Tennessee so great.”
The new business filings and annual reports tend to be a leading indicator of future employment growth, Bruce said.
“We still, in this state, have more job openings than we have unemployed people and I expect that to increase, actually,” Bruce said. “I’d be very surprised if we didn’t see an increase in employment growth fairly soon in the data.”
Jobs increased by 0.2% in May and unemployment held steady at 3.6%, according to the report.
Artificial intelligence is a potential factor in the slower employment growth, Bruce said.
“But we don’t expect it to be the dominant storyline,” Bruce said. “It’s mostly been about labor force to this point. That being said, we’re on the front edge of that curve and I think what AI is doing thus far in Tennessee is creating jobs, first and foremost, as we build infrastructure to support that technology.”
While Tennessee’s real personal income was $513.2 billion in the first quarter of 2026, a 2.2% increase over last year, it fell by 2.4% when adjusted for inflation. The year-over-year personal income growth rate is 3.3%, just shy of the national rate of 3.6%, according to Bruce.
“And this is where the major headline comes into play,” Bruce said. “I think what we’ve seen with the inflation data is that inflation has ticked back up largely due to oil prices. And when prices go up faster than incomes, we tend to pay a little bit more attention because that represents a reduction in purchasing power in the short term.”
Inflation should get back under control in the next several months, Bruce said.
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And they weren’t paid to come here.