Forbes has just released its new ranking of Best States for Business (and Careers) for 2011.
The table showing all 50 states is at: http://www.forbes.com/special-report/2011/best-states-11_rank.html.
In 2011 Maryland ranks #19 overall, down from #14 in 2010. (I first started tracking this report in 2006 when Maryland ranked #11 overall.)
The overall #19 ranking is a composite of 6 rankings as follows:
- Business Costs – 42 (most weight given here)
- Labor Supply – 12
- Regulatory Environment – 22
- Economic Climate – 13
- Growth Prospects – 40
- Quality of Life – 9
The components of each of the above rankings can be found at: http://www.forbes.com/sites/kurtbadenhausen/2011/11/22/best-states-for-business-methodology/
Observations
- The most dramatic (and alarming) change from 2010 is in the “Growth Prospects” ranking where Maryland fell from #29 to #40. We were #17 in 2006. Here’s how Forbes defines this ranking:
“The growth prospects category measures job, income and gross state product growth forecasts over the next five years from Moody’s Analytics. Other factors include business opening and closing statistics in each state from the Small Business Administration. We also measured venture capital investments per PricewaterhouseCoopers and the National Venture Capital Association.” - While Maryland’s ranking in “Business Costs” improved slightly from 2010 – from #49 to #42 – it nevertheless remains too high. In 2006 we were ranked #42. Here’s the Forbes definition of this category:
“Business costs incorporate Moody’s Analytics cost of doing business index which include labor, energy and taxes in our rankings. Moody’s weighs labor the most heavily in its index. We also included a new state tax index from the Tax Foundation that looks at the tax burden on business in each state across different industries. The new study will be released to the public in the coming months. Business costs are the most heavily weighted component in the Forbes Best States for Business.” - The “Overall” ranking of #19 in 2011 reflects a steady decline for Maryland. In 2006 we were ranked #11. In 2010 we were ranked #14. The decline from 2010 appears to be due primarily to the significant decline in the “Growth Prospects” category.
- Maryland now suffers from a 40’s ranking in two critical categories: “Business Costs” and “Growth Prospects.” This should serve as a guideline for policymakers to identify the areas where improvement is needed and no further harm should be done!
