Where Do They Get Their Information?
More than 70 percent of the respondents to our 2011 Corporate Survey say they get their site selection information from magazines like Area Development. About 40 percent also utilize general business magazines and economic data aggregators when performing a location search.
Interestingly, only 53 percent of the 2011 Corporate Survey respondents say they use the Internet for site and facility planning information, down from 76 percent of the 2010 survey respondents who made that claim. Of those that do use the Internet for this process, three quarters are looking for data on specific locations, more than half for listings of available buildings and sites, and nearly half for economic development agency contact information. According to the responses from our 2011 survey-takers, for the most part, this is not an activity they engage in on a daily or even weekly basis.
More than 50 percent of the 2011 Corporate Survey respondents start the information-gathering process one or two years or more in advance of making a location decision. Another 31 percent start just six months to a year out. Once they've determined the locations of interest, a third make contact within a month, another third within three months, and a fifth not until about six months later.
Just one to five locations make the short list of nearly 90 percent of the survey respondents, and 60 percent will visit up to five of the prospective communities. About 40 percent of the 2011 Corporate Survey respondents say they reach a location decision within three to six months of making initial contact with the locations of interest; however, nearly another 40 percent say it takes them six months to a year after that initial contact to come to a location decision, and a fifth of the respondents will take one to two years to make up their minds!
More than half of those responding to our 2011 Corporate Survey do not use outside site selection or business consultants in the location decision process. Of those that do, two thirds ask the consultants to perform location studies or comparative analyses as well as help with the real estate transaction. Slightly more than a third of the respondents also say they utilize the consultants for performing feasibility studies, incentives comparisons and negotiations, as well as for help with the construction process.
What Does It All Mean?
The results of our 2011 Corporate Survey show that new facility and expansion plans remain steady - if not robust. Again, 80 percent of the respondents say they do not expect the U.S. economy to improve significantly until 2013 or 2014.
However, there is projected to be an increase in relocation activity brought about by a need to move to more pro-business areas, in terms of having a reduced tax burden and less onerous government regulations. The survey respondents have also placed greater emphasis on the need to find the right labor force - both skilled and unskilled - as well as to acquire the appropriate financing in order to innovate and grow their businesses. Reports of financing loosening up are welcome news.
A January 6 report from the Commerce Department also recommends that the federal government increase investment in initiatives to support business innovation. According to the report, "The government could directly fund basic research through support of government labs or grants to universities or private research laboratories. Additionally, government policy could increase the returns earned by the private sector on basic research - through policies such as tax credits and a well-functioning patent system - and encourage the private sector to do more basic research."
The Commerce Department report also cites the need for more government initiatives that encourage students to pursue science, technology, engineering, and mathematics, or STEM, fields. This would help in the long term to satisfy companies' needs for qualified labor, i.e., to close the skills gap.
Of course, this being a presidential election year, government policies could change across the board - for better or worse. We will have to choose between competing views of what the government's proper role in the economy should be. Additionally, the euro crisis, a slowdown in the Chinese economy, and other global events could further stall the U.S. economic recovery. Let's hope those in Washington can work together to implement policies that drive growth so that there will be no need to continue to ask our readers when they expect the economy to improve!