COVER STORY: BUSINESS CLIMATE RANKINGS

f North Carolina Gov. Mike Easley had waited just a couple more weeks to announce his state’s strong performance in some business climate contests, he could have included Site Selection‘s ranking North Carolina first in its annual analysis of state business climates, as well. In late September, the governor announced a string of accolades recognizing state universities, technology clusters and metro areas as key business climate contributors.

Shortly thereafter, for the second year in a row – and for the fifth time in six years – North Carolina ranked first in Site Selection‘s business climate ranking.

   The ranking is based 50 percent on a survey of corporate site selectors and 50 percent on states’ performance in four categories associated with Site Selection‘s proprietary New Plant database (see the Top State Rankings chart). The categories are: the state’s overall rank in total qualifying new or expanded projects in 2005; New Plant performance from 2003-2005; rank per million population; and rank per 1,000 square miles.

   At 50 percent of the final ranking, corporate site selectors’ input is crucial. They indicate which 10 states they think have the best business climate based on their experience of managing property assets around the country.

   Among survey respondents’ comments concerning North Carolina are these: “Local and state officials are very accommodating to new and expanding businesses”; “State support of employers in terms of training and site-selection resources, availability of competent and cost-competitive employees and fair workers’ comp regulations”; “Available incentives and responsiveness of government”; and “Higher education, labor force, transportation and a friendly business climate.”

   A Massachusetts-based corporate real estate manager cited North Carolina’s “labor supply, economic incentives, universities and intellectual resources, fast permitting, climate and access to capital.” From Maryland: “Very simply, it’s the ease of doing business, lack of red tape and the cities’ and state’s willingness to work with you to bring your business there.” And from a Wisconsin executive: “First, energy costs; second, access to labor; third, transportation costs; and fourth, quality of life.”

   Governor’s Easley’s thoughts on why North Carolina is

attracting industry as diverse as NASCAR and biotechnology can be found elsewhere in this issue, in the North Carolina Spotlight on page 866. Quality of the work force is foremost on potential investors’ minds, he tells Site Selection Senior Editor John McCurry.

   “Providing a work force with the knowledge, talent and skill employers need to compete in the global economy brings high quality jobs to hard working North Carolina families,” noted the governor at the announcement of other business-climate accolades on September 28th. “It is no surprise that since 2001, our state has successfully recruited more than 163,400 jobs and $26.2 billion in investment.”

   Among the highlights of the governor’s September announcement were these:

   • The Milken Institute of Santa Monica, Calif., listed three North Carolina public and two private universities among the top 100 in the world in ability to move biotech research into business start-up. The public universities and rank are North Carolina State University (20th), UNC-Chapel Hill (25th) and East Carolina University (81st); the private schools are Duke University (38th) and Wake Forest (59th).

North Carolina Department of Commerce The Milken Institute Forbes Magazine Entrepreneur Magazine’s List of Hottest Cities

   • The Silicon Valley Leadership Group, a public policy advocacy organization in San Jose, Calif., named the Raleigh-Durham area as the top technology hub in the nation in its annual ranking. The report noted the area’s affordable housing and thriving job market as well as local student performance on eighth-grade math tests, comparatively low taxes and affordable utilities.

   • Raleigh placed fifth in Forbes.com’s list of Most Wired Cities; Charlotte ranked 10th. The two cities received high marks for the number of companies providing high-speed Internet access and the percentage of homes with high-speed Internet connections.

   • Entrepreneur magazine listed the Charlotte-Gastonia and Raleigh-Durham metros as two of the best locations for entrepreneurs to start and grow a business, ranking them second and third respectively. Only the Phoenix-Mesa, Ariz., area ranked higher.