#39 Vermont: No Job Problems Here
VERMONT’S UNEMPLOYMENT RATE is among the lowest in the nation, and “Help Wanted” signs are popping up. Vermont Economy Newsletter projects 6,000 new jobs this year, but the state’s population is falling and younger workers aren’t moving in.
Vermont faces a $100 million shortfall this fiscal year and employers worry the state will impose a payroll tax. “The payroll tax has been scuttled, at least for now,” says William Driscoll, vice president of the Associated Industries of Vermont, a manufacturers’ trade group. Driscoll’s association and other trade groups continue to press for tax reform and energy-rate restructuring.
The closing last winter of the Vermont Yankee power plant left a sour taste among manufacturers. “This was a big missed opportunity” to lower rates, Driscoll said. The Tax Foundation ranks Vermont’s state and local tax burden 9th highest out of 50 states, and the state came in at No. 45 in business tax climate. Vermont spends more than $407 million a year on incentive programs.
#40 Rhode Island: Lacking Leadership
THE RHODE ISLAND ECONOMY is healthier now than it was at this time last year, but the Ocean State continues to face “significant uncertainties and challenges,” according to the New England Economic Partnership. While unemployment continues to drop, Rhode Island’s current level remains third-highest in the country. Along with New Hampshire, it is one of two Northeastern states still below pre-Recession employment levels.
The state suffers from slow growth in key industries, including manufacturing, construction, information, financial services, trade, transportation and utilities. Older and less-educated workers are marginalized in the state’s largely stagnant economy. Leadership has been problematic. Rhode Island “has been dis-served by successive government administrations,” asserts site selector Dennis Donovan, a partner at WDG Consulting in Bridgewater, New Jersey. “Taxes are too high, the regulatory burden is too high and it’s too bureaucratic.”
Last fall, voters sent state treasurer Gina Raimondo to the governor’s mansion after she succeeded in cleaning up her state’s pension-system mess. Having campaigned on promises to reignite a sputtering economy, the 43-year-old new governor will now be held to it by business leaders. “She is talented, educated and smart,” says Dennis Roberts, a lawyer, ex-attorney general, and son of a former governor. “I have faith in her.”
The Tax Foundation ranked Rhode Island’s state and local tax burden 8th highest out of 50 states and ranked it 46th in business-tax climate. Rhode Island spends over $356 million a year on incentive programs.
#41 Maryland: Lukewarm on Business
AS A CANDIDATE FOR GOVERNOR, Maryland’s Larry Hogan campaigned on a pro-business platform, promising to “get the government off our backs and out of our pockets, so we can grow the private sector, put people back to work and turn our economy around.”
During the race, he called for better state corporate recruitment and job-creation programs and promised an overhaul of the Department of Business and Economic Development if elected. Expect Maryland’s business leaders to press him to make good on his promises—and perhaps reverse his opposition to completing the Purple Line, the $2.45 billion light rail project that many consider key to the region’s economic future.
Historically, Maryland has not been aggressive with incentives. “I don’t get the sense [that] they are very pro-business,” says Dan Breen. The Tax Foundation ranked Maryland’s state and local tax burden 7th highest out of 50 states, and ranked it 42nd in business-tax climate. Maryland spends at least $554 million a year on incentive programs.