Washington comes in a respectable No. 9 in the 2016 “Best and Worst States for Business” rankings published by Forbes magazine.
Here’s how the Washington ranking breaks down.
Washington moves up one slot from last year’s No. 10 ranking, with some slight movement in the six rankings categories.
Forbes reporter Kurt Badenhausen frames the criteria:
Forbes’ Best States for Business list factors in 40 metrics from 17 sources across six broad categories: business costs, labor supply, regulatory environment, economic climate, growth prospects and quality of life (click here for a detailed methodology).
A new addition in this year’s ranking in the regulatory category is a measure of laws that protect people from employment discrimination based on sexual and/or gender identity. The state ratings were provided by the Movement Advancement Project, which identified 18 states that offer protection for LGBT people and 18 states that are hostile.
Topping the rankings this year, for the third year in a row, is Utah, followed by North Carolina, Nebraska, Texas and Colorado. Here’s the full list.
Earlier this year Washington ranked No. 31 in Chief Executive magazine’s rankings, No. 17 in the Tax Foundation’s Best State Business Tax Climate rankings, out of the top 20 in Area Development magazine’s rankings, and out of the top 25 in Site Selection magazine’s rankings. The criteria are subjective and they vary. Here’s a good analysis of some of the factors at work.
The Forbes ranking is the highest for the state we’ve seen recently, helped by strong growth prospects and a good labor supply; dinged by regulatory costs and quality of life. Washingtonians who often justifiably point to the state’s great quality of life may cavil. Forbes, however, has a specific and somewhat idiosyncratic definition:
Quality of life takes into account cost of living from Moody’s, school test performance via the Department of Education and crime rates from the FBI. We factored in the mean temperature in the state as a proxy for the weather and the number of top-ranked four-year colleges in the state from Forbes’ annual college rankings. We considered the culture and recreational opportunities in the state based on an index created by Bert Sperling, as part of our annual Best Places for Business and Careers. Other factors: commute times from the U.S. Census and select measures like air pollution and primary care physicians from the United Health Foundation’s America’s Health Rankings.
While we don’t put a whole lot of stock in these “best business climate” assessments except as reference points, it’s better to be in the top ten than in the bottom ten. The Forbes ranking will likely be something our political and economic development leaders will be happy to cite in future campaigns.