Top 10 worst states for business. Is yours on the list?
Business is tough everywhere, but some states are doing a better job of encouraging business growth than others. That鈥檚 the contention of Ronald Pollina, author of 鈥淪elling Out a Superpower: Where the U.S. Economy Went Wrong and How We Can turn It Around鈥� (Prometheus Books, 2010).
This week, Pollina released his annual list of the 10 worst states for business. California was ranked as the worst, with Arkansas, Minnesota, Alaska and New Jersey among other states listed. Pollina compiled the list based on 31 corporate site selection factors.
Governors and politicians can do a lot to affect how friendly to business their are, Pollina said.
鈥淭alk is cheap, and governors need to stop making excuses and stop focusing solely on raising taxes and service-cutting solutions,鈥� said Pollina, owner of a corporate real estate firm in Chicago. 鈥淭hese are short-term solutions to long-term problems that they refuse to address. They have no effective economic plans. Ask them and politicians say they will increase jobs.鈥�
Pollina鈥檚 list of the 10 worst states for business:
10. Arkansas
9. Minnesota
8. Alaska
7. Kentucky
6. New Jersey
5. Wisconsin
4. Massachusetts
3. West Virginia
2. Rhode Island
1. California
With the exceptions of Alaska and Arkansas, these states face 2012 budget shortfalls of $44.6 billion, or approximately 36 percent of the $125 billion shortfall for all states, Pollina said.
RELATED: Unemployment up? Not in these four maverick cities.
For these states, unemployment ranges from 7.1 to 12.4 percent. They suffer from the 鈥渄eadly duo鈥� of high corporate taxes (26th to 47th highest nationally) and not being right-to-work states (employee has option of not joining union). Only Arkansas is a right-to-work state.
鈥淭here are ways to allow limited right-to-work with only minor compromise by unions, but even this scares the pants off most politicians, better to raise taxes and cut services,鈥� Pollina said.
Combine federal and state corporate taxes and wages and these states rank among the most expensive places in the world for business. This pushes companies offshore if they are to survive in the global marketplace.
As taxes rise and services diminish in these states, their 4 million will have more company.
Last year, Pollina released his top 10 best states for business list. That ranking was as follows:
1. Virginia
2. Utah
3. Wyoming
4. South Carolina
5. North Carolina
6. Nebraska
7. Kansas
8. South Dakota
9. Alabama
10. Missouri
The study ranked the states based on the same 31 factors controlled by state government, including taxes, human resources, education, right-to-work legislation, energy costs, infrastructure spending, workers compensation laws, economic incentive programs and state economic development efforts.
RELATED: Unemployment up? Not in these four maverick cities.
