Chief Executive magazine is out today with its 2015 “Best and Worse States for Business” rankings. Washington moves up one spot, from #33 in 2014 to #32 this year.
The top five states are, in order: Texas, Florida, North Carolina, Tennessee and Georgia.
Here’s the link to the Washington page.
These rankings always get some attention, but they tend to be very subjective. The “best state” results are all over the map, literally, depending on who’s doing the ranking and what they value. Take them all with a pillar of salt.
The Washington Research Council did a good overview of the “business climate” rankings a few years ago. It’s still valid.
Reviewing a number of media, think tank and business assessments, including the Chief Executive survey, the WRC concluded:
As we’ve written before, there is no “best business climate.” The number of claimants to the title makes the point. As criteria change, new contenders arise. Different industries will place higher or lower emphases on factors like land and energy costs, presence of research universities, access to markets and capital, business taxes, regulatory requirements and so on…Costs continue to matter.
The rankings, whether based on weighted assessments of a state’s policies or the perceptions of business owners, tilt south, toward states that have aggressively courted business with incentive programs and business-friendly tax, labor and regulatory policy.
Quality public services, particularly education, also matter. Technology and innovation, as well as more traditional industry, rely on a skilled workforce, research and development, and high-performing transportation and communications systems.
While the measurements vary, the substance of most business climate studies remains consistent. High quality public services and competitive costs are critical to a state’s long-term growth prospects.
Perceptions, like those expressed in the Chief Executive survey, offer some insight into how others see the state. Of greater importance, though, is how public policy handles the balance of controlling costs and delivering high quality public services.
The Benchmarks acknowledge what it takes to succeed today: “To become and stay competitive in the global economy, Washington must engage in a balanced strategy that encourages innovation, high quality of life and a healthy business climate.”
From that premise comes a clear and concise vision: Make Washington a top 10 state for quality of life and innovation, while ensuring it is not one of the 10 most expensive states in which to do business.
The Benchmarks track 13 metrics, grouped in three clusters: innovation, quality of life, and business costs.
We have room to improve. Progress on transportation, education, workforce training, budget sustainability in this legislative session is critical to that improvement.