Washington drops eight places to No. 39 in Chief Executive magazine’s latest “Best and Worst States for Business” report. The rankings are based on a survey of chief executives across the nation. The magazine says of the methodology,
…Chief Executive surveys CEOs, not corporate site-development specialists. Company leaders usually choose to focus on the big picture, so their perceptions often trump statistical minutiae.
“CEOs don’t get involved in the numbers that much, and we seldom meet with them,” says Dean Uminski, a site-selection specialist with Crowe Horwath in Chicago. “But it’s their perceptions that really matter, because usually they end up making the ultimate decision.”
And, while perceptions can take a long time to change, reality may be even more resistant. “The top-ranking states have continued to implement public policy supporting economic development to ensure that they remain as leaders,” says Larry Gigerich, executive managing director of Ginovus, a Fishers, Indiana-based site-selection concern.
Our state posted lowest marks in Taxes and Regulation, with better marks in Workforce Quality and Living Environment. Washington page here; full rankings here.
3.82 out of 10 in Taxation and Regulation
6.07 out of 10 in Workforce Quality
6.51 out of 10 in Living Environment
Right to Work? ✗
While we don’t consider these types of “business climate rankings” definitive, we still think it’s useful to see how others see us. And these rankings are based entirely on perceptions (methodology here).
For a broader look at the various approaches to evaluating state business climates, check out this 2012 policy brief from the Washington Research Council, which concludes
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.
This year, Chief Executive reporter Dale Buss writes,
Because of how CEOs view business climates, because states themselves have varying priorities and because of the slow pace of change in many state governments, the same states have held top five spots for six years running.
Texas was ranked No. 1 for the 13th straight year in 2017 by the hundreds of CEOs surveyed by Chief Executive. Florida was No. 2 for the fifth year in a row. Five of the remaining eight top-10 states were the same as in 2011, albeit shuffled a bit. On the other end of the spectrum, California anchored the bottom of the list at No. 50 for the sixth consecutive year, New York wallowed at No. 49 and Illinois listed at No. 48.
Again, these rankings are based on perceptions. And, despite the relatively low ranking the state receives in the survey, there’s this from the state’s profile.
Washington’s GDP in the first quarter of 2016 grew three times faster than the national rate, and the Evergreen State has outpaced the nation as a whole for four years running, growing 8.1 percent compared to 6.5 percent from 2012 to 2015. Washington added 290,000 jobs since 2013, and in 2016, at a faster rate (3.1 percent) than 48 other states.