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When Quality of Life Closes the Location Decision Deal

Just like beauty, quality of life is in the eye of the beholder. When it comes to choosing a location, it's a minor consideration for some. But for others, it makes all the difference.

Dec/Jan 10
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Happy Employees
It's been well documented that companies perform better when their employees are happy in the workplace. Quality of life has a huge impact on overall employee satisfaction, productivity, and retention. "Employees who are happier are more productive, miss fewer work days, and are more creative, focused, and loyal," says Gigerich. "Quality-of-life factors add value to a company's bottom line."

Sweeney agrees. "Quality of life flows into personnel issues and ultimately productivity," he says. "A high quality of life is particularly important for recruitment - the ability to attract the best and most desired talent to your location - and retention - having employees stay with the company because they are satisfied with their quality of life. Job satisfaction is positively correlated with productivity, and QOL will influence that." He says dissatisfaction with QOL issues can lead to key people performing below peak and ultimately leaving the organization, disrupting productivity and increasing costs.

Cities that are consistently mentioned when discussing a high quality of life include Austin, Texas; Charlotte, North Carolina; Denver, Colorado; and Minneapolis-St. Paul, Minnesota. Emerging high-QOL communities include Albuquerque, New Mexico; Boise, Idaho; Greenville-Spartanburg, South Carolina; and Nashville, Tennessee.

"Companies that choose to locate [in Sacramento] are looking for a diverse and broad talent pool and know that quality of life is important for recruiting and retaining the best employees possible," says Tracey Schall, director of strategic marketing for the Sacramento Area Commerce and Trade Organization. Sacramento was among Fortune's 100 Best Places to Live and Launch a Business (2008) and Forbes' Best Cities for Young Professionals (2008). "We particularly see this trend when working with international companies, especially those companies originating in Europe."

Marc Vogt, CEO of a German solar company, recently set up operations in Sacramento. "We see the U.S., and California in general, as being a strong potential market for us," he says. "We also wanted to locate on the West Coast because of our exports to Asia." Why did he choose Sacramento instead of San Francisco or Los Angeles, or elsewhere along the coast? He says the company looked at Oregon and Washington, states that offered similar incentives to California. But in the end, quality of life won out. "I have a 3-year-old daughter, and I just couldn't see her in rainy Seattle." The city's parks, access to mountains and the San Francisco Bay area, a thriving downtown, and abundant bike lanes were also factors in the decision.

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