Following last week’s rankings from the US Chamber of Commerce, another list is out ranking the “Best and Worst States for Business” in 2013, this time assembled by Chief Executive magazine. Unsurprisingly, perhaps, Texas is #1 and California #50, with many red states filling the top spots and blue states scraping the bottom.
Regular readers of Via Meadia know we have our qualms with the tax and regulatory structure of states like California, but sometimes these lists can get out of hand. The Chief Executive rankings are said to be based on state GDP, unemployment, domestic migration, debt per capita, and the state-local tax burden, but even then no heed is paid to the concentration of high-skilled labor, college grads, capital, or entrepreneurs. There are plenty of good reasons an entrepreneur would choose to start a business in Silicon Valley rather than South Dakota despite the latter’s lower tax rate.
It’s true that the entrepreneurial world is gradually shifting away from the long-established coastal hubs towards heartland locales like Austin, Houston, Raleigh, and Salt Lake City, and this is a very good thing. But this isn’t a full-scale exodus, and many college grads, entrepreneurs, and young families are still unsure which cities and states make it easiest for them to be creative and take risks.
The factors driving such decisions are different for everyone depending on age, experience and lifestyle preferences. But we suspect that many young and entrepreneurial Americans share a few priorities regarding what is most important when deciding where to begin one’s life.
Via Meadia would like to hear what they are. TAI is looking to assemble our own index of American cities and states for college grads and young families, and we want to know what readers think we should look at in order to get reasonably useful results.
Part of the problem with some rankings efforts may be that they are too general. “Favorable business climate” can mean a lot of things, and small start ups have different priorities than large corporations. Some business models require a dense concentration of affluent consumers; no matter how low the tax rates are you wouldn’t set up a boutique imported chocolate truffle business in a small Montana town. Ultimately the choice of where to set up a business or where to live is determined by individual factors which no set of rankings however thoughtfully assembled can capture.
That doesn’t mean such rankings serve no purpose; if nothing else they can serve as preliminary screens which help people zero in on locations worth a closer look. And they can also serve as guides for local governments looking at ways to enhance the standing of their communities.
Use the comments section to let us know what is most important to you and why. And if there are any rankings already out there that you think do the job pretty well, we’d like to hear that too.