May 6, 2011

CEOs Grade the States

Marc Comtois

Yeah, I know, who cares what a bunch of rich CEOs think. Anyway, fwiw (h/t Ted Nesi):

Business leaders graded the states on a variety of categories grouped under taxation and regulation, workforce quality and living environment. “Do not overtax business,” offered one CEO. “Make sure your tax scheme does not drive business to another state. Have a regulatory environment and regulators that encourage good business—not one that punishes businesses for minor infractions. Good employment laws help too. Let companies decide what benefits and terms will attract and keep the quality of employee they need. Rules that make it hard, if not impossible, to separate from a non-productive employee make companies fearful to hire or locate in a state.”

Not surprisingly, states with punitive tax and regulatory regimes are punished with lower rankings, and this can offset even positive scores on quality of living environment. While state incentives are always welcome, what CEOs often seek are areas with consistent policies and regulations that allow them to plan, as well as intangible factors such as a state’s overall attitude toward business and the work ethic of its population.

OK, how'd we do? As Nesi points out, RI is close to middle-of-the-pack at #35 overall. But a closer look at the individual categories doesn't paint quite as bright a picture (in a "hey, at least we aren't the worst!" sorta way).

First, here are the actual stats:

43rd - % GROWTH 2005-09
39th - DOMESTIC NET MIGRATION RATE PER 1,000 (2000-2006)
48th - DEBT PER RESIDENT $ ($8,716)
40th - STATE AND LOCAL GOVERNMENT EMPLOYEES PER 10,000 RESIDENTS (ranked lowest to highest - 510.84)

Then are the ratings by CEOs (ie; their perception of RI):


Basically, it looks like our unemployment rate and low gov't employee/10,000 residents got us "up" to #35, because every other statistic is pretty much what we expected it to be. Finally, here is how Rhode island and the rest of New England compare in the eyes of the CEO's (it's not good for RI):

New Hampshire (6th)
Maine (38th)
Connecticut (42nd)
Vermont (43rd)
Massachusetts (46th)
Rhode Island (47th)

New Hampshire (6th)
Connecticut (26th)
Massachusetts (27th)
Vermont (37th)
Maine (40th)
Rhode Island (41st)

New Hampshire (8th)
Vermont (29th)
Maine (34th)
Connecticut (36th)
Rhode Island (41st)
Massachusetts (43rd)

Yay, we beat someone! Regardless, the stats aren't important. It is the perception. We need to change that perception so corporate decision makers will change their minds. We can't just say it or believe it to make it so. We actually have to do something.

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Those CEOs are just angry because RI gives them such generous tax breaks!

Posted by: Patrick at May 6, 2011 12:43 PM

The "forced union" states are bringing up the rear in all fields while the right-to-work states are leading the pack. Must be just another in a long line of coincidences.

Progressives will no doubt blame the more successful right-to-work states for interfering with their top-down control scheme.

Posted by: Dan at May 6, 2011 1:10 PM

I saw the article on PBN. Note the headline...

"CEOs say R.I. better than most N.E. states for business",57863

Although Rhode Island ranked on the bottom half on this list, the state did better than most of its regional counterparts, including Massachusetts, No. 45, Connecticut, No. 44, Vermont, No. 40, and Maine, No. 36.

Yeah, we beat every state in NE except New Hampshire! Interesting that Marc seemed not to notice.

Posted by: Russ at May 6, 2011 3:16 PM

Sure Russ, as if "We're not the worst" is an effective marketing slogan to attract businesses to invest here.

You always have to try to come up with a turd in the punchbowl, regardless of the obvious facts.

(An ironic metaphor, considering that on the nationwide comparison, RI is one of those punchbowl floaters. Then again, it's people like Russ, Phil, Cicilline, Chafee and the other "Progressives who made it that way.)

Posted by: BobN at May 6, 2011 3:35 PM

Yes, Russ, and Rhode Island is ranked the WORST in New England for Taxation and Regulation, Workforce Quality, AND Quality of Living. So the still rather crappy aggregate score doesn't mean much when those particularly important business factors are considered.

Oh look - 48th in debt per capita.

Way to go, progressives.

Posted by: Dan at May 6, 2011 3:51 PM

Russ, I noted that the overall report said RI did better than I thought the dis-aggregated data seems to show. My focus on the New England comparison was on the CEO opinion, not the stats. I have no idea how they came to their conclusion (ie; weighting or whatever---I either originally missed the methodology or they posted it after my post) that RI is better than our neighbors but made some guesses (unemployment, gov't employee ratio).

Posted by: Marc at May 6, 2011 3:56 PM

Who cares what those rich ray-zists think.
The real job creators are superior thinkers like Russ, Jared Paul, Bruce "Killer" Reilly, Pat Crowley and Tom Sgouros.

Posted by: Tommy Cranston at May 6, 2011 6:50 PM

(An ironic metaphor, considering that on the nationwide comparison, RI is one of those punchbowl floaters. Then again, it's people like Russ, Phil, Cicilline, Chafee and the other "Progressives who made it that way.)
Posted by BobN at May 6, 2011 3:35 PM

What the hell did I do? All I do is raise and sell oysters and dig wild quahogs. Oh and I pay taxes. I obey most of the laws most of the time, but not at the same time. What's your beef with me?

Posted by: Phil at May 6, 2011 8:02 PM

It's freaking cold in New Hampshire. I think they still have snow on the ground. And if it's such a great place to do business, where are all of the businesses? I have some friends who live up there that are highly educated and work in Massachusetts. Another friend's hotel foreclosed due to lack of business in the Sunapee area, he's hanging drywall when he can find the work, and it is scarce, and far away.

Posted by: michael at May 7, 2011 10:43 AM

In a head to head fight with state birds RI is right at the top of all the states. Our Rhode Island Red can kick the asses of all the others. New England states offers up such entries as the chickadee from Maine and Mass. Vermont brings the Hermit Thrush to the fight. I wonder if it would really show up. Ct. has the robin. Rocking or otherwise I don't think it could drop the Red. New Hampshire's bird is the Purple Finch. We all know about the color purple. Outside New England the only serious competition comes from New Mexico with the Roadrunner. Maybe good in a road race but in a cockfight I think it would turn tail and does what it does, run for it's life. We'll have to get Ken to instruct us about the Nene from Hi. Delaware puts up something called the Blue Hen Chicken. In the coming days we'll explore the rankings of the union state's birds against the "right to work" state's birds, but keep in mind that some of the birds may be "migratory" and we'll have to check their legal status.

Posted by: Phil at May 7, 2011 9:58 PM
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