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Top States Commentary: Survey of Location Consultants Fails to Capture Progress Made by Many States

Daniel H. Levine, Principal, MetroCompare (Fall 2012)
Top States for Doing Business Full Results: 2012 Top States for
Doing Business Survey
»

OVERALL RANKINGS
2012

1.  Texas
2.  South Carolina
3.  Georgia
4.  Alabama
5.  North Carolina
6.  Louisiana
7.  Tennessee
8.  Indiana
9.  Mississippi
10.  Oklahoma

2011

1.  Texas
2.  Georgia
3.  Alabama
4.  South Carolina
5.  Indiana
6.  Louisiana
7.  North Carolina
8.  Tennessee
9.  Mississippi
10.  California

2010

1.  Tennessee
2.  Texas
3.  South Carolina
4.  Alabama
5.  Georgia
6.  Indiana
7.  Mississippi
8.  North Carolina
9.  Virginia
10.  Oklahoma

CONSULTANTS COMMENTARY
Winning States Offer Low Taxes, Generous Incentives, and Fewer Regulations
Eric Stavriotis, Senior Vice President, Strategic Consulting, Jones Lang LaSalle
States With Deep Pools of Skilled Workers Come Out on Top
Scott Redabaugh, Managing Director, Jones Lang LaSalle
Ranking state competitiveness is a tricky business because during an actual corporate site selection project, all 50 states are never really in competition against one another. Rather, different subsets of states are typically in play depending upon the type of industry/function involved and the geographic requirements of the client. Consequently, the geographic diversity that I see in my projects is not reflected in the results of this survey in which a handful of states dominate the top rankings.

About half of all states, for example, were not ranked as being competitive in a single category. Yet these omitted states include [many] of those with the lowest unemployment rates during 2012. Other omissions were equally surprising. Texas, for example, did not rank among the top five states in terms of competitive labor costs; nor did any northeastern state appear among the [top-five] in terms of those with the greatest availability of skilled labor. That is not to say that there is a total disconnect between the survey results and the real economy. No one can argue, for example, that in terms of overall regulatory and tax climate the southern states are every bit as competitive as the survey's results suggest.

What the survey fails to capture, however, is the tremendous progress that almost all states have made in improving their business climates post-Great-Recession. Moreover, different states respond very differently depending upon the type of project that is being considered. And sometimes a state that responded really well to one project appears disinterested in another. In my experience, state competitiveness is best-measured one project at a time.
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