Propelled by a jump in Connecticut’s “growth prospects,” the state jumped six places higher on this year’s Forbes Best States for Business list, moving up to #33 from last year’s #39.
Each year, Forbes sizes up the 50 states on six economic categories. We improved in three of the categories—labor supply, growth prospects, and quality of life—and fell in two: regulatory environment and economic climate.
Our near-bottom ranking on business costs (47th) stayed the same as last year’s, which is unfortunate because, says Forbes, “Business costs, which include labor, energy and taxes, are weighted the most heavily.”
What’s behind the “growth prospects” ranking? Forbes explains:
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 the MoneyTree report from PricewaterhouseCoopers and the National Venture Capital Association.
Our jump (from 31st to 26th) in Growth Prospects moves Connecticut to middle of the pack, which is pretty encouraging considering the long road to recovery we’re on.
Still, the drop in regulatory environment and economic climate rankings, along with the lack of progress on business costs, seems to augur a tougher, not easier, road ahead.
Virginia came in at the overall #1, Massachusetts (13) the highest of the New England states, and New York placed 21st.
New Jersey is just ahead of us at #32 due to its much better ranking (16) on growth prospects.
“Pockets of the U.S. are primed for growth thanks to pro-business regulatory environments, educated workforces and reasonable business costs,” said Forbes. “Virginia is the only state to rank in the top five in four areas—only missing on costs and growth prospects.”
We've got a long way to go--lawmakers please take note on the disappointing rankings for business costs, regulatory climate and economic climate--but the upward motion is a good sign.