{{RELATEDLINKS}}2020 was indeed an unusual year — as one of our clients asked rhetorically, “So, when’s the last time the world stopped?”

Capital projects were placed on hold (with only a few exceptions). Uncertainty in buyer demand, government regulations, and financial performance caused a major time-out in both the public and private sectors. Most location-focused projects were suspended, if not outright cancelled. Therefore, it must be recognized that any advisor’s opinions collected with this survey are most likely limited based on severely curtailed project activity — but will the results be different than in past years?

All the advisors responding to this survey have based their opinions on their individual recent experiences garnered while assisting clients with the few projects of various types and sizes that went forward. In dealing with the various states, one must keep in mind that those experiences varied greatly in terms of site-readiness, labor availability, operating costs, etc.

However, if one were to view this year’s results by comparing them to those of 2016–2020, interestingly, many of the same states have appeared in the top 10 rankings over the past five years (specifically GA, SC, TX, TN, AL, IN, NC). Therefore, we find this year’s results very credible despite the unusual circumstances. Prior to 2020, at the highest level of perspective, business was extremely robust, and corporations were enjoying a time period that saw strong consumer confidence, low economic volatility, and little hesitation making long-term business commitments. While we all know there are exceptions to anything, the pandemic will certainly bring about major change.

Several factors come to mind: overall corporate location strategies may be modified; search criteria may be re-emphasized to include how well states and local governments handled COVID mandates; and how the process is conducted may be altered (e.g., minimal community tours, etc.). In short, corporations were (maybe still are) not comfortable making long-term decisions, and costs associated with location analysis are thought to be better spent elsewhere.

Additionally, based on delayed business growth during this past year, many advisors and client organizations have found themselves performing incentive restructuring/recasting with state and local governments. New job creation and capital spending time commitments contained within initial incentive agreements have been delayed in most cases — and although these investments will eventually occur, time schedule relief is necessary until business resumes in a normal fashion. Therefore, the category of “cooperative and responsive state government” will become increasingly important in the next few years, perhaps in a way not seen in the past.