Logistics also drives the region, as both transportation companies and enterprises dependent on distribution favor its northernmost states. With the growth of Latin American trade, this trend has benefitted the more southerly states, as well. “One of the major influences on the Southeast will be the Panama Canal expansion,” says William Hearn, senior vice president of strategic consulting at CBRE, the consulting and economic-incentives group. “Most people believe the southeast ports up to Norfolk will be the benefi ciaries. But I believe we will see more goods moving through the east coast ports that get their dredging done. One of the major projects is the recently opened inland port in Spartanburg, South Carolina, that’s tied to BMW expansion, providing great accessibility to and from both Georgia and North Carolina.”
“When you talk about the Southeast, you are talking about the major leagues of economic development,” notes Chicago based site selector Jerry Szatan. “Economic development in the U.S., in the years since the end of World War II was pretty much invented by the Southeast out of economic necessity.”
Florida (No. 2): Bringing in Business
The Sunshine State continues its recovery from the Great Recession, driven in large part by its successful policies aimed at attracting migratory companies. The state’s business environment “has improved enormously under Governor Scott and Enterprise Florida CEO Gray Swope,” says Gregory Burkart, managing director in the Detroit office and leader of the business incentives advisory practice at Duff & Phelps.
“Before Scott, maybe one in 10 executives had Florida on their site selection list, and we’d try to talk them out of it. Nowadays, it’s one in five, and we try to talk them into it.”
Florida’s legislature’s Office of Economic and Demographic Research told Floridians last December that their personal income growth is ahead of the national average; while GDP growth is advancing, it lags behind the national average. Florida recruits migratory executives with a combination of lures, including its zero percent individual income tax rate, abundant sunshine and work force capabilities. The Tax Foundation ranks Florida’s state and local tax burden 20th-lowest out of 50 states and fifth for business-tax climate. The state spends over $4 billion per year on incentive programs.