2017 Best & Worst States For Business

2017 RANKSTATE LAST YEAR'S RANKCHANGE
1TexasThe country’s No. 1 exporter, Texas exported $232 billion in goods in 2016, according to the Texas Economic Development Corp. Texas has the second-largest state airport system, including the world’s first purely industrial airport at the Fort Worth Alliance Global Logistics Hub; 11 deep-water ports including the Port of Houston, one of the nation’s top 10; and 10,425 miles of freight rail, more than any state.10
2FloridaFlorida businesses created 60,600 private-sector jobs in the first quarter of 2017, bringing the total number of new jobs added since December 2010 to more than 1.3M. For the fifth consecutive year, Florida’s annual job growth rate of 3.2% is exceeding the nation’s rate of 1.7%.20
3North CarolinaNorth Carolina’s Economic Development Partnership streamlines the tasks of marketing North Carolina and trying to lure companies considering relocation. The public-private partnership took the reigns from the N.C. Commerce Department and is set to receive $21.4M in state money this year.30
4South CarolinaSouth Carolina exporters in 2016 posted a seventh consecutive record year with export sales of $31.2 billion – a $400 million increase over last year, according to The S.C. Department of Commerce. In total, the state recruited more than $3.4 billion in capital investment, creating approximately 13,100 new jobs.73
5IndianaIndiana’s Major Moves 2020 is a program to widen and rehabilitate heavily-traveled, four-lane interstates in Indiana that are now approaching 50 years of age. According to the Indiana Dept. of Transportation, Major Moves 2020 and other projects within the state’s $1B infrastructure program will strengthen Indiana’s economic competitiveness and quality of life by improving travel times and reliability.50
6NevadaThe State Policy Reports’ 2017 Index of State Economic Momentum ranked Nevada first, based on three key measures of economic vitality: personal income growth, employment growth and population growth. The Silver State had the strongest personal income growth in the nation on a year-over-year basis, carried the third highest employment growth rate and was the fastest growing state in the nation.93
7TennesseeTennessee lawmakers in April passed the IMPROVE Act, raising the state gas tax by six cents and the diesel tax by 10 cent to pay for road and bridge projects across the Volunteer State. The gas and diesel tax increases would be offset by more than $500 million in tax cuts annually at the law’s full implementation, including a 20 percent decrease in the sales tax on groceries that equals $125 million and a $113 million reduction in business taxes on manufacturers.4-3
8GeorgiaGeorgia’s robust incentive program for TV and film productions brought in 245 productions in fiscal 2016, which spent $2.02B during that time and generated an economic impact of $7.2B, according to Georgia’s Film, Music & Digital Entertainment Office. The Peach State offers up to a 30% tax credit for all film and TV productions shot in the state: 20%, plus an additional 10% for productions that embed the Georgia logo in their program or participate in other promotional marketing for the state (according to AdWeek).80
9ArizonaArizona and Baja California signed a memorandum of understanding designed to contribute to the strengthening of the cross-border supply chain in key industry sectors and medical tourism between the two neighboring states. Arizona Gov. Doug Ducey also recently signed legislation that extends the incentives to data center companies that make major investments in their computer and telecommunication operations within the Grand Canyon State.6-3
10WisconsinThe number of graduates in STEM fields within the the University of Wisconsin System has been steadily growing since 2009. A total of 7,325 undergraduate and 1,620 graduate degrees in STEM fields were conferred by the UW system in 2015, compared to 5,153 undergraduate and 1,241 graduate degrees in 2009.111
11OhioA second-straight near-record construction season is underway across Ohio. This year, the Ohio Department of Transportation will invest $2.3 billion into the state’s roads and bridges, just shy of the record-$2.4 billion investments made in 2014 and 2015.10-1
12UtahUtah Gov. Gary R. Herbert in March announced Talent Ready Utah's first steps in working toward his goal of filling 40,000 new high-skill, high-paying jobs in Utah over the next four years. The governor announced that the Utah Cluster Acceleration Partnership will become the grant program for Talent Ready Utah, with more than $2.1 million in grant funding available for the purpose of developing and enhancing programs to meet industry needs, building career pathway programs and providing work-based learning opportunities.164
13ColoradoColorado has embarked on the largest reform of the state’s procurement code, modernizing statutes and making it easier for more companies to submit bids to do state work. The new law, based on HB 1051, also exempts grants from the state bidding requirements, and it makes it easier for losing bidders to challenge decisions they feel were unfair.152
14IowaIowa Gov. Terry Branstad kicked off the state’s “Year of Manufacturing,” with the goal to increase Iowa’s manufacturing GDP from $29B to $32B by 2022. The initiative, led by the Iowa Economic Development Authority, Iowa State University's Center for Industrial Research and Service and the Iowa Association of Business and Industry will focus on building a skilled workforce, promoting innovation and research and development, and improving global competitiveness.173
15VirginiaThe Virginia Commonwealth Transportation Board in 2016 approved a $14.4 billion, six-year transportation improvement program that will fund a variety of highway, bridge and transit projects. The plan will also finance the first projects approved under the state's new SMART SCALE project prioritization and ranking program, which scores potential projects based on a variety of criteria in an effort to determine which will offer the greatest return on investment for taxpayers.12-3
16DelawareThe State of Delaware, DuPont, and the University of Delaware established a nonprofit public-private partnership, Delaware Innovation Space Inc., which will catalyze the entrepreneurial growth of new science-based businesses and ventures in Delaware. Moreover, Gov. John Carney signed an executive order for a public-private working group at the Delaware Economic Development Office to explore how state government can work with the private sector to improve economic development efforts in Delaware, including ways to attract new, growing companies to the state, build a stronger entrepreneurial community and support innovation.13-3
17OklahomaOklahoma Gov. Mary Fallin in May signed into law a bill extending tax incentives to employers and employees in the aerospace industry. More than 1,100 aerospace and defense-related companies are in Oklahoma, generating more than $27 billion in sales annually and employing more than 120,000 workers.181
18IdahoIdaho Gov. C.L. “Butch” Otter announced the creation of a Governor’s Workforce Development Task Force charged with studying ways to improve Idaho’s funding and delivery of training programs to meet growing employer demand for skilled workers. The effort is part of the Governor’s “K-through-Career” campaign and the statewide goal of 60% of Idahoans between the ages of 25 and 34 having a postsecondary degree or technical certification by 2020.213
19AlabamaAlabama lawmakers are considering legislation that would raise the state gasoline and diesel tax by 4 cents a gallon to fund more than $4B in infrastructure improvements to roads, highways and bridges. The bill, HB 487, also would provide the state with money to match and leverage any funding provided from the anticipated federal infrastructure program, one of Trump’s campaign promises.201
20NebraskaA bill for income tax and agricultural property tax changes was voted down recently in the Nebraska legislature. Lawmakers fell short on a motion to end a filibuster on Legislative Bill 461. On a lighter note, however, Nebraska has joined the “Gigawatt Club.” With the raising of Grand Prairie, a 400-megawatt wind farm in Holt County, Nebraska has sailed past 1,000 megawatts— or 1 gigawatt—of wind-generated capacity. It's the 18th state to join the club, according to the American Wind Energy Association.277
21South DakotaThe South Dakota business climate is No. 1 in the nation for entrepreneurs according to the Small Business and Entrepreneurship Council. The Mount Rushmore State’s overall tax burden is ranked second in the country according to the Tax Foundation, with no corporate income tax, no personal income tax, no personal property tax, no business inventory tax and no inheritance tax.19-2
22KentuckyKentucky is on the verge of surpassing its record for business investments, fueled by three separate billion-dollar announcements in early 2017 totaling more than $5B, according to the Associated Press. Since January, 53 companies have pledged just over $5B on new facilities and expansions in Kentucky, which should add about 8,000 mostly full-time jobs, with average annual salaries of about $43,500.242
23ArkansasThe Arkansas Economic Development Commission has formed a Blue Ribbon Commission to study opportunities to grow the state’s economy associated with computer science and data analytics, focusing on business challenges in computing and data analytics, potential for growing niches within those sectors and ways to build Arkansas’ talent pipeline with the required skills. State lawmakers also recently enacted the Arkansas Business and Technology Accelerator Act to create a $2M accelerator grant program for startups, aided by corporate sponsors providing matching funds to create accelerator events throughout the state.230
24WyomingSome of the most popular ways agricultural producers are diversifying their operations include meat processing and ranch recreation, and the Wyoming Business Council, the state’s economic development agency, has made it easier for producers to access and understand regulatory, licensing and registration obligations as they launch new operations.14-10
25MissouriGov. Eric Greitens established the Committee for Simple, Fair and Low Taxes shortly after taking office to compare Missouri’s tax credit programs and its tax rates to those of its peer states, assess the economic impact of existing state tax credit programs, assess the possibility of financing cuts to overall state tax rates with cuts to tax credit programs, and make comprehensive tax reform legislation recommendations.294
26MontanaMontana manufacturers are optimistic about their prospects for 2017, according to a survey of 250 companies released in March by the Bureau of Business and Economic Research at the University of Montana. Montana manufacturers in 2016 shipped roughly $9.7B in goods, accounted for roughly 16% of Montana’s economic base, employ roughly 24,500 workers, and paid about $46,000 per year, per person in earnings, well above the statewide average of $39,000.25-1
27KansasKansas Governor Brownback has made Growing the Kansas Economy one of the top priorities of his administration. Since he took office, over 65,000 private sector jobs have been created, and the Sunflower State has set a record for new business filings every year since 2011 at a time when national startup businesses are on the decline.26-1
28North DakotaNorth Dakota is positioned for a leaner, more efficient state government, as state lawmakers in April passed a $4.3 billion general fund budget for 2017-19 that represents a more than 28 percent decrease, from $14.2 billion to $13.6 billion, from the current two-year budget cycle, which ends June 30. The budget contains more than $1.3 billion in local property tax relief, including $161 million in state funding to cover the cost of federally and state-mandated county social services and reduce local property tax rates.22-6
29PennsylvaniaIn 2017, the Pennsylvania Dept. of Transportation kicked off its Road Maintenance and Preservation (Road MaP) program, which will invest $2.1 billion in maintenance and highway and bridge capital projects over the next 10 years. Of the investments, $1 billion will go to roadway maintenance and $1.1 billion will go to highway and bridge capital projects, including an interstate preservation and reconstruction program, as well as other rehabilitation and reconstruction needs throughout the Keystone State.367
30New MexicoGov. Susana Martinez announced $40 million worth of investments, which include the launch of a $20M Catalyst Fund that will raise a matching $20M in private equity for investments in local startups. The Catalyst Fund is expected to support more than 50 companies in New Mexico and will focus on aiding tech startups.322
31New HampshireGov. Chris Sununu has met with 127 businesses during his first 100 days in office to have substantive discussions about New Hampshire's strong fundamentals, including quality of life, community involvement, and low tax base. A major goal was to better understand their needs, while communicating his plans to truly tap New Hampshire's potential as an economic driver.28-3
32MississippiMississippi lawmakers are considering a plan to increase funding for infrastructure by about $150M starting in July, allocating $50M in bonds for bridges; $25M for county projects and $25M for municipal projects. The legislation would divert between $50M and $70M online sales tax revenue collected by the state from sellers like Amazon and other retailers, to be earmarked specifically for road and infrastructure improvements and repairs.4210
33LouisianaLouisiana lawmakers are considering enhancements to the state’s incentive program for film and TV productions, including expanded tax credits and a streamlined certification process. The industry has generated more than $6B in film and television production work in Louisiana since the modernized incentive program began in 2002.374
34AlaskaGov. Bill Walker signed legislation making it easier for the Dept. of Military and Veterans Affairs to designate “military facility zones,” which would enable Alaskan communities to create tax incentives for business development related to military activities and stimulate local economic activity. The state, with assistance from the University of Alaska Center for Economic Development, also is currently drafting Northern Opportunity: Alaska’s Economic Strategy, the state’s first comprehensive economic development strategy “to guide economic development policy, inform funding decisions for state and industry, identify opportunities for communities to grow and prosper, and provide a clear path to jobs for future generations.”30-4
35MaineMore than 8,000 jobs have been created in Maine since 2011, including jobs from the economic development initiatives that Gov. Paul LePage’s administration has established. Additionally, companies have invested nearly $400M in capital to grow their operations in the Pine Tree State.33-2
36MichiganPure Michigan Business Connect is a public-private alliance of MEDC, state agencies and major Michigan companies and organizations that connects in-state companies to business resources. Since the program was launched in 2011, it has facilitated more than $4.5B in revenue for Michigan companies, which translates into approximately 20,000 jobs for Michigan residents.404
37West VirginiaWest Virginia provides a home and advanced technology research and services to some of the world's most recognizable organizations including the Coast Guard's Information Technology Center of Excellence, the Federal Bureau of Investigation’s Fingerprint Identification Center and NASA’s Independent Verification & Validation Facility. Moreover, the Mountain State’s school system received the highest marks in the country in a national education technology survey, earning a grade of “A” in Education Week’s “Technology Counts Report.”35-2
38MinnesotaThe Minnesota Department of Transportation in March awarded $23.7M in grants to 23 transit providers across the state, to help improve the reliability, frequency and service of their transit systems. The North Star State currently has 44 transit systems serving all 80 counties, with transit ridership in rural areas increasing 12.6% between 2010 and 2014.34-4
39WashingtonWashington’s GDP in the first quarter of 2016 grew three times faster than the national rate, and the Evergreen State has outpaced the nation as a whole for four years running, growing 8.1 percent compared to 6.5 percent from 2012 to 2015. Washington added 290,000 jobs since 2013, and in 2016, at a faster rate (3.1 percent) than 48 other states.31-8
40VermontOn Vermont Gov. Phil Scott’s first day in office on Jan. 5, he signed an executive order directing all state agency secretaries and department commissioners to utilize their powers, duties and programs to establish growing the Vermont economy. The order also directed the agencies and departments to find ways to make Vermont an affordable place to live, work, and do business; as well as to find ways to protect vulnerable Vermonters, “as cornerstones of their strategic and operational goals.”38-2
41MarylandMaryland held its first Business Summit bringing together Maryland business, education and community leaders to focus on key issues impacting Maryland’s economy, including innovation and entrepreneurship, the global economy, human capital and attracting venture capital. The Old Line State has added nearly 100,000 jobs since Gov. Larry Hogan took office in January 2015, a priority of the administration.432
42Rhode IslandRhode Island Commerce Dept. has embarked on a new manufacturing initiative — a package of workforce training and economic development programs which aim to rebuild Rhode Island’s manufacturing industry for the 21st Century. The Rhode Island Manufacturing Initiative includes economic development incentives to encourage manufacturers to purchase new equipment, launch new product lines and hire new workers, and it also expands successful training initiatives within the Ocean State.41-1
43HawaiiThe High Tech Development Corp. awarded more than $1M in grants to six Hawaii-based companies to support their R&D efforts of new products and solutions. HTDC’s 80/80 Initiative is projected to create 80,000 new tech and innovation jobs that will provide high paying jobs for Hawaii residents.441
44OregonThe Oregon Manufacturing Innovation Center in Portland is a collaborative environment bringing together industry, higher education and government in partnership to develop new tools, technique, and technologies to address near-term manufacturing challenges through applied research and advanced technical training. OMIC is modeled after The University of Sheffield Advanced Manufacturing Research Centre (AMRC) at University of Sheffield with Boeing in Sheffield, England.39-5
45MassachusettsA large majority of companies that chose Massachusetts as a place to expand their business would do it again, primarily based on its innovative economy, industry clusters and skilled workforce, according to “Choosing Massachusetts for Business: Key Factors in Location Decision-Making,” an 18-month study commissioned by MassEcon, the nonpartisan economic development organization, and conducted by the UMass Donahue Institute’s Economic and Public Policy Research group. According to survey respondents, the top three strengths of doing business in Massachusetts were workforce, superior industry clusters and the community environment.450
46ConnecticutNearly 3,800 new jobs have been created in Connecticut and $1.3B has been invested in new infrastructure at the 13 companies participating in Gov. Dannel P. Malloy’s First Five Plus jobs initiative, which provides assistance for large-scale business projects as a means of encouraging business expansion, relocation and job creation. For small businesses that export, The Connecticut Dept. of Economic and Community Development is giving grants of up to $7,000, as part of the U.S. Small Business Administration’s State Trade and Expansion Program.460
47New JerseyThe New Jersey Economic Development Authority partners with nearly two dozen banks in the state to offers loans with up to a $2M EDA loan participation or $1.5M loan guarantee for fixed assets, up to a $750,000 loan participation or $1.5M loan guarantee for term working capital, and up to a $750,000 line of credit guarantee. Businesses must typically commit to creating a minimum number of jobs within two years, generally one job per $65,000 of EDA exposure.470
48IllinoisStarting under Gov. Bruce Rauner's administration, the Illinois Competitiveness Council is dedicating efforts to helping small businesses start, expand or stay in Illinois. The administration also is working to cut the red tape and make it easier for businesses to grow and thrive in Illinois, in part by reducing restrictions within the Illinois Code by 25%.480
49New YorkNew York has announced plans for a $1.2B biotech research center in Valhalla and the American Institute for Manufacturing Integrated Photonics hub in Rochester. The Empire State also is embarking on a $100B infrastructure improvement plan, replacing the Tappan Zee Bridge, redeveloping LaGuardia and JFK Airports, and renovating the Penn-Farley Station and the Gateway Tunnel to New Jersey.490
50CaliforniaThe California Competes Tax Credit committee approved $91.4M in tax credits for 114 companies, which will help them create a projected 8,223 jobs and generate over $828M in total investment across California. Also Gov. Jerry Brown signed into law the Road Repair and Accountability Act of 2017, a $52.4B infrastructure program to fix roads, freeways and bridges, as well as more money for transit and safety.500