What do Florida, Georgia, North Carolina, South Carolina, Tennessee and Texas all have in common? Yes, they're all in the South, but more importantly, according to a new study, they're the six best states in the nation when it comes to the business climate they create.
In Development Counsellors International's latest report, which it's produced for 18 years, DCI looked at trends in economic development throughout the United States. And with the input of business leaders and site-selection consultants, DCI came up with the latest shortlist of pro-business locations.
"With competition for business more fierce than ever, this information is particularly important for communities as they look at how to influence corporate executives’ decisions on where to locate, invest and create jobs," says Andy Levine, president and chief creative officer of DCI.
Respondents, all of them C-level executives or business-location advisors, ranked the top six states as follows:
1. Texas: 49.7 percent (Texas has held on to the No. 1 spot since 1999.)
2. Florida: 18.1 percent
3. Georgia and North Carolina (tie): 17.6 percent
4. South Carolina: 12.6 percent
5. Tennessee: 11.6 percent
Diving deeper into the results, let's look at what makes for a great business state.
Incentives and Workforce Quality
There are some commonalities in the way business leaders and the study's experts say they look at supportive business environments. Key concepts include a state's tax structures, the financial assistance and incentives it offers, and the availability of a high-quality workforce.
Similar to taxes and incentives, the worker base is an element to which states should pay close attention, according to Levine. "I think it's a responsibility that falls heavily on the states," Levine says, speaking recently to The Street. "What companies are doing is, they're going to places that have a strong, educated workforce. They're not trying to find places where they have to educate the workforce."
Deciding With Data
For states that have that kind of mix in play, the challenge then becomes telling companies about the business-friendly environments they have to offer. In that regard, respondents ranked the following types of outreach as most effective:
- Information-rich websites: 67 percent
- State proponents visiting business leaders: 64 percent
- Media relations/publicity outreach: 48 percent
- State-hosted special events: 46 percent
- Trade shows: 38 percent
- Paid advertising: 17 percent
- Direct mail: 14 percent
- Telemarketing: 6 percent
What's underway is evident: Businesses find their relocation search most often satisfied by data they can find for themselves, online. Location advisors, in particular, noted this as a frequent avenue to information: 56 percent say they turn to Internet research—especially the websites of economic-development organizations—to help their clients identify new potential sites.
Once online, site selectors say they look for a number of details, ones that support the key factors that land new companies in the states that did well in the 2014 survey. Among the most desirable data, the following ranked as the top three:
- Information about incentives: 68 percent
- Workforce stats: 48 percent
- Demographics data: 48 percent
With nearly half (44 percent) of the polled business leaders indicating that their companies would be making a move in the next two years, paying attention to the states that are most business-friendly, such as the six outstanding examples in this year's study, would be a wise move for those looking to attract new businesses.
For companies looking to find a new home base, the financial and talent-based resources of this year's top spots are already in place, ready and waiting.
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