Best States For Business

[vt]

http://www.washingtonpost.com/blogs/...undation-says/

[dcarrigg]

Re: Best States For Business

http://www.washingtonpost.com/blogs/...undation-says/

If Wyoming and South Dakota are so good for business, why are no Fortune 500 firms located there? If New York is the worst state for business, then why are about 1/5 of America's Fortune 500 firms located there? Are they irrational? Are they stupid? Or is the Tax Foundation merely measuring ideological nonsense with no relation to the real business world to push a political agenda?


http://www.job-hunt.org/employers/Fortune-500/by-state/

[vt]

Re: Best States For Business

http://frontpagemag.com/2013/dgreenf...esses-in-2012/

http://www.examiner.com/article/illi...-to-high-taxes

http://money.cnn.com/2011/06/28/news...nies/index.htm

[LorenS]

Re: Best States For Business

It's one thing to successfully get a business off the ground and running. It's quite another to consolidate your empire and begin to hob nob.

If Wyoming and South Dakota are so good for business, why are no Fortune 500 firms located there? If New York is the worst state for business, then why are about 1/5 of America's Fortune 500 firms located there? Are they irrational? Are they stupid? Or is the Tax Foundation merely measuring ideological nonsense with no relation to the real business world to push a political agenda?

How many large corporations have you worked for? Yes, they are irrational, no they're not stupid, but I don't see a lot of genius in upper management either. For example the former CEO of the corporation I used to work for took the company from $2B in revenue to $2B in revenue over 10 years with virtually unchanged profit margins and profitability. WOW! What a genius!!!

Politics, connections and the whim of the CEO drive HQ locations. In crony capitalism influence and connections trump taxes.

On the other hand, small businesses thrive in the locations that the large corporations overlook.

[dcarrigg]

Re: Best States For Business

There is more to business than just tax rates. They factor in. But they are not the sole factor. They're not even necessarily a primary factor. Shipping costs to market from the middle-of-nowhere Wyoming are going to be a lot higher than from the center-of-it-all New York. God forbid you need proper heavy utility access or shipping...

A super rural state with 500,000 people is going to have low taxes and low property taxes. Because there are no cities to support. That's why the states ended up in the west. Cities cost money. They also generate business and develop workforce. And they are where the big markets are.

You could go ahead and bet the house on Cheyanne or Pierre becoming global business powerhouses due to their low tax rates. I'd take the other side of that bet in a heartbeat.

[dcarrigg]

Re: Best States For Business

I've only worked for one Fortune 500. Business citing decisions depend on a lot more than just tax rates alone.

[LorenS]

Re: Best States For Business

I've only worked for one Fortune 500. Business citing decisions depend on a lot more than just tax rates alone.

I get your point, sort of. I think you are still confusing good for the CEO, vs good for business. Very few businesses really thrive in high tax, high crime, congested and corrupt environments, but there are certainly ones that do and are more than happy to drag their unfortunate employees along with them.


Most folks don't want to be in the middle of a global business powerhouse. That's the point. Business exists to serve the needs of man. What better place for a business than where most people want to live, and in the environment most people want to live in? Too much business destroys what most people want. Hence, success breeds destruction as is clearly seen in places like London or NYC or LA.

Sure there's more than tax rates. How about housing costs, crime, commute time, quality of education?

NY city and most large California cities have high taxes, high crime, poor public schools and horrible commute times/conditions. Maybe the CEO can afford to escape the worst of all of this, but the rest of the folks can't. It just really depends on what you want to call "good for business". Is making the CEO uber rich all that qualifies?


What I find amazing is the people who go somewhere because "that's where the money is". They get there, earn loads of money and realize it's so expensive to live that their money isn't doing them much good.

I live far better on one income in a small town than most two income families in the "prosperous" cities. Plus my commute is under 10 minutes if I walk and I can get out of town on the weekends without sitting for hours on a highway somewhere.

Talent goes where it's rewarded. In the cities talent is rewarded with money, in the outlying areas talent is rewarded with quality of life. In the cities talent tends to be fickle while in the smaller communities it's more likely to find loyal talent. In cities people want others to entertain them, in the countryside folks tend to be able to enjoy themselves in simpler surroundings. Cities have culture, countryside has nature.

I've never heard an honest employer complain that they could not attract talent to a low tax, low crime non urban environment. Why do you think the concept of telecommuting has become so popular? Given the option most people do not like living on floor x in the middle of a bunch of skyscrapers.

[lakedaemonian]

Re: Best States For Business

What I would really like to see is how each US state would rate internationally in terms of "Best Countries for Business".

http://www.forbes.com/sites/kurtbade...-for-business/

I wonder if differences between states would reflect much difference when incorporating the individual states as countries globally?

There is a noticeable difference in bureaucracy between myself and my US based peer group(based on their experiences) that I'm glad I don't have to deal with.

[LorenS]

Re: Best States For Business

I wonder if differences between states would reflect much difference when incorporating the individual states as countries globally?

A whole lot of fortune 500 "businesses" are registered in the Cayman Islands. Does that mean the Cayman Islands are "good for business". Does any business even get done there.

It's the same with New York. A lot of high paid people do a whole lot of stuff there, but how much of it is business? Is bundling subprime mortagaes, overrating them to AAA and selling them to uncle Joe's pension fund business? I'd argue that most of what goes on in New York doesn't really need to be done and may actually even be harmful to the economy when it is done. When I sell stock it takes 3 days for me to get the cash. New York must have some of the slowest computers on the planet.

There is a noticeable difference in bureaucracy between myself and my US based peer group(based on their experiences) that I'm glad I don't have to deal with.

America, where we make emerging economies competitive by handcuffing our own businesses. I don't doubt that you're spot on.

[vt]

Re: Best States For Business

Texas has as many Fortune 500 corporations as California or New York. Georgia and Florida as many as Massachusetts and Connecticut. More important is the direction the corporations are taking: leaving New York, California, and Illinois.

[think365]

Re: Best States For Business

A whole lot of fortune 500 "businesses" are registered in the Cayman Islands. Does that mean the Cayman Islands are "good for business".

The Fortune 500 list is made up entirely of U.S. companies. To qualify for the list the company must be headquartered (domiciled) in the United States. FYI.

[dcarrigg]

Re: Best States For Business

It's the same with New York. A lot of high paid people do a whole lot of stuff there, but how much of it is business? Is bundling subprime mortagaes, overrating them to AAA and selling them to uncle Joe's pension fund business? I'd argue that most of what goes on in New York doesn't really need to be done and may actually even be harmful to the economy when it is done.

I don't think the data agrees with your assessment:

New York City Nonagricultural Employment (2012BM) (000's)
PUBLISHED INDUSTRY TITLE	Aug-13	Jul-13	Aug-12
Total Nonfarm	3,951.6	3,965.2	3,867.2
Total Private	3,407.2	3,409.5	3,322.5
Goods Producing	199.2	196.1	195.4
Service Providing	123.8	122.5	118.8
Private Service Providing	30.2	30.1	32.8
Natural Resources, Mining and Construction	88.3	87.5	76.6
Construction of Buildings	53.5	53.6	46.9
Specialty Trade Contractors	15.1	14.7	14.3
Building Equipment Contractors	75.4	73.6	76.6
Building Finishing Contractors	26.9	26.6	27.0
Manufacturing	48.5	47.0	49.6
Durable Goods	16.4	16.4	16.9
Non Durable Goods	37.5	37.6	36.7
Apparel Manufacturing	32.8	32.1	31.3
Trade, Transportation, and Utilities	600.0	598.3	583.0
Wholesale Trade	144.7	145.2	141.0
Merchant Wholesalers, Durable Goods	53.5	52.8	51.6
Merchant Wholesalers, Nondurable Goods	74.2	74.7	73.1
Apparel, Piece Goods, and Notions Merchants	30.5	30.7	30.1
Grocery and Related Product Merchants	21.0	21.1	21.4
Retail Trade	334.6	332.8	324.8
Furniture and Home Furnishings Stores	10.0	10.0	9.7
Food and Beverage Stores	77.0	76.1	73.8
Grocery Stores	57.5	56.7	55.8
Health and Personal Care Stores	41.2	41.0	40.2
Clothing and Clothing Accessories Stores	79.3	78.5	74.6
Clothing Stores	63.8	64.2	59.3
Sport. Goods, Hobby, Book, and Music Stores	11.8	11.5	11.8
General Merchandise Stores	40.0	40.0	39.2
Department Stores	28.7	28.8	28.5
Miscellaneous Store Retailers	19.9	19.5	19.4
Transportation, Warehousing, and Utilities	120.7	120.3	117.2
Utilities	15.2	15.3	15.4
Transportation and Warehousing	105.5	105.0	101.8
Air Transportation	27.9	28.2	28.9
Transit and Ground Passenger Transportation	24.4	25.2	23.8
Support Activities for Transportation	15.0	15.1	15.4
Support Activities for Air Transportation	5.6	5.5	5.4
Couriers and Messengers	17.9	17.7	15.4
Information	175.5	176.1	178.3
Publishing Industries (except Internet)	45.2	45.4	46.3
Motion Picture and Sound Recording	51.3	50.7	49.9
Broadcasting (except Internet)	29.4	29.6	29.9
Radio and Television Broadcasting	18.8	19.0	19.5
Cable and Other Subscription Programming	10.6	10.6	10.4
Telecommunications	21.6	21.4	22.6
Financial Activities	442.2	448.2	444.3
Finance and Insurance	323.9	326.1	325.9
Credit Intermediation and Related Activities	92.3	91.9	90.4
Depository Credit Intermediation	48.2	48.4	48.9
Commercial Banking	39.6	39.8	40.9
Nondepository Credit Intermediation	31.1	31.2	30.2
Securs., Commod. Contr., and Othr. Finan. Invs. & Relat. Activs.	167.8	169.2	171.2
Securities and Commodity Contracts	103.5	104.2	107.9
Investment Banking and Securities Dealing	42.2	42.4	43.6
Securities Brokerage	57.6	58.1	60.9
Insurance Carriers and Related Activities	54.7	54.8	54.9
Insurance Carriers	33.6	33.6	34.0
Agencies, Brokers., and Othr. Insur. Relat. Activs.	21.1	21.2	20.9
Funds, Trusts, and Other Financial Vehicles	6.3	6.4	6.4
Real Estate and Rental and Leasing	118.3	122.1	118.4
Real Estate	108.5	112.0	109.0
Lessors of Real Estate	67.3	69.3	65.8
Professional and Business Services	642.5	638.4	627.4
Professional, Scientific, and Technical Services	363.1	361.2	354.7
Legal Services	76.7	77.5	77.4
Accounting, Tax Prep., Bookkpng., and Payroll Servs.	45.7	46.2	46.1
Architectural, Engineering, and Related Services	28.9	28.8	28.4
Computer Systems Design and Related Services	62.1	61.6	59.0
Management, Scientific, and Technical Consulting Services	37.6	37.4	39.1
Scientific Research and Development Services	15.0	15.4	15.1
Advertising and Related Services	66.8	66.0	63.0
Management of Companies and Enterprises	63.6	63.6	65.6
Admin. & Supp. and Waste Manage. & Remed. Servs.	215.8	213.6	207.1
Administrative and Support Services	209.0	207.2	199.4
Employment Services	71.8	70.5	70.2
Business Support Services	13.8	14.2	14.2
Investigation and Security Services	49.9	49.4	48.4
Services to Buildings and Dwellings	39.9	39.6	38.5
Education and Health Services	789.3	791.5	757.2
Educational Services	172.6	173.4	158.5
Elementary and Secondary Schools	39.3	41.2	37.8
Colleges, Universities, and Professional Schools	91.9	92.2	85.8
Health Care and Social Assistance	616.7	618.1	598.7
Ambulatory Health Care Services	207.9	206.7	195.6
Offices of Physicians	52.4	52.6	52.2
Outpatient Care Centers	17.3	17.3	16.9
Home Health Care Services	92.4	91.8	85.9
Hospitals	163.2	163.0	159.8
General Medical and Surgical Hospitals	146.6	146.4	144.1
Specialty (except Psychiatric and Substance Abuse) Hospitals	15.0	15.0	13.7
Nursing and Residential Care Facilities	74.2	74.5	74.2
Nursing Care Facilities	42.2	42.5	42.6
Residen. Mental Retrdtn., Mental Hlth., and Sub. Abs. Facls.	23.7	23.7	22.9
Other Residential Care Facilities	4.9	4.9	4.7
Social Assistance	171.4	173.9	169.1
Individual and Family Services	121.4	123.3	121.4
Commun. Food & Hous. and Emerg. and Other Relf. Servs.	10.0	9.8	9.5
Vocational Rehabilitation Services	12.5	12.5	12.1
Child Day Care Services	27.5	28.3	26.1
Leisure and Hospitality	383.2	383.8	368.2
Arts, Entertainment, and Recreation	80.9	81.4	73.2
Performing Arts, Spectator Sports and Related Industries	37.3	37.6	33.4
Promoters of Performing Arts, Sports and Similiar Events	8.4	8.5	10.2
Museums, Historical Sites, and Similar Institutions	13.5	13.6	12.8
Amusement, Gambling, and Recreation Industries	30.1	30.2	27.0
Other Amusement and Recreation Industries	27.4	27.5	25.0
Accommodation and Food Services	302.3	302.4	295.0
Accommodation	47.5	47.3	47.7
Traveler Accommodation	46.7	46.5	46.3
Food Services and Drinking Places	254.8	255.1	247.3
Full Service Restaurants	135.6	134.4	137.7
Limited Service Eating Places	82.3	82.7	77.0
Other Services	175.3	177.1	168.7
Personal and Laundry Services	50.2	50.9	50.1
Religs., Grntmkng., Civic, Prof., and Simlr. Orgs.	111.1	111.0	104.2
Government	544.4	555.7	544.7
Federal Government	50.4	50.0	50.4
U.S. Postal Service	17.7	17.6	18.0
State Government	44.8	45.0	46.0
State Government Education	4.4	4.4	4.4
State Government Hospitals	5.4	5.4	5.6
Local Government	449.2	460.7	448.3
Local Elementary & Secondary Schools	138.7	144.4	139.1

[dcarrigg]

Re: Best States For Business

Texas has as many Fortune 500 corporations as California or New York. Georgia and Florida as many as Massachusetts and Connecticut. More important is the direction the corporations are taking: leaving New York, California, and Illinois.

Georgia has 10 million people and Florida has 19. Mass has 6.5 and CT has 3.5. The fact that they are keeping up at all should say something.

The per capita income in Texas is 30% lower than what it is in Massachusetts, and the unemployment rate is comparable.

We'll see what happens if/when the oil boom pops. My guess is that Texas' long term boom and bust cycle will continue.

Again, I'm not saying that tax rates don't matter.

I'm saying that the empirical data doesn't bear out this pseudo-religious devotion that believes business siting decisions and business climate are solely a factor of tax rates.

[LorenS]

Re: Best States For Business

I don't think the data agrees with your assessment:

New York City Nonagricultural Employment (2012BM) (000's)

It's possible I'm wrong. Maybe NYC really is an industrial powerhouse.



Top categories: Trade, Government, health care and professional services
Goods producing was a pretty small %, but maybe I'm reading it wrong.

PUBLISHED INDUSTRY TITLE

I'd rather see it broken down by job description. If you're buying fuel futures for Boeing it doesn't mean you're building an airplane. If you're selling bonds for Caterpillar you're not building bulldozers.

I'm not saying New Yorkers don't work. And yes there is still some manufacturing going on in the city, Steinway pianos used to be there as well as Henry rifles.

Still, the data you posted only tells what the employer is doing overall, not what the NYC employees are actually doing in the city. My question still remains what business is actually accomplished by the people who actually live there. Is the city really good for business, or is it good for the upper management and FIRE portions of businesses.

[LorenS]

Re: Best States For Business

The Fortune 500 list is made up entirely of U.S. companies. To qualify for the list the company must be headquartered (domiciled) in the United States. FYI.

http://campaign.comerica.com/busines...domiciles?ct=1

There are approximately 5,000 captives in the world, with Bermuda the largest domicile. Over 40% of Fortune 500 companies have a captive.

Actually, I think we're agreeing in a rather contentious manner. Because I don't think much "business" gets done in Bermuda in spite of it's tax haven status.

You're saying that low tax rates alone don't make a place good for business. I'm actually agreeing, but my point is that "business" is not necessarily done where the taxes are (or aren't ) paid. You pointed out NYC as home of a bunch of Fortune 500 companies. I took exception because in my mind not much real business actually gets done there.

In any case I will concede your point that South Dakota and Wyoming would not be my #1 place to locate a business either. ROI on taxes is a better way to look at it. Are high taxes buying you good roads, low crime, reliable infrastructure and honest government/regulation? If so I'll take the taxes (within reason) over a run down dump with really low taxes.

It's just that in many parts of the US high taxes are accompanied by high crime and corrupt government.....