"WA Business Climate: Contradictions & "All Over the Map""

As we've written before, this "best state for business" business is complicated. Others have reached the same conclusion. In the September Washington CEO, Aaron Corvin provides a good rundown of what he dubs a "state of contradictions." And the Washington Policy Center's small business expert, Carl Gipson has a Puget Sound Business Journal op-ed headed "Washington's business climate is all over the map."

WashACE readers will recognize many of the reports cited, but both articles are worth a full read.

Corvin blends data with interviews.

Don Brunell, president of the Association of Washington Business, says there is little room for comfort in competing with other, lowercost states. And the cost of doing business in the state could go up in a number of new ways, he says, including by way of the Paid Family Leave Act...

Additionally, Brunell doesn't see the state's advantage in low electricity costs lasting for long: Initiative 937, approved by voters statewide in 2006, requires utilities to increase their use of renewable energy. But pre-existing hydropower, which provides about two-thirds of the state's electricity, doesn't count.

And this.

Scott Carson, CEO of Boeing Commercial Airplanes, says high unemployment and workers' compensation rates, coupled with rising taxes and energy costs and problems with traffic and education, "make it increasingly difficult for Washington state businesses to compete." No one should assume "Boeing or any other company will remain here just because of history," he says, which makes it imperative to control costs.

Corvin does a great job of touching on all the points business leaders we talk to cite regularly: business taxes, energy costs, regulation, workforce (especially engineers, scientists, and skilled tradespeople), and  more. It's good to see the WashACE 2008 Competitiveness Redbok used as a data-rich source to back up the anecdotal evidence.

Gipson's op-ed reviews the data from several studies and does a good job of sorting through the disparate tax ratings. And he asks the right question:

In 2007 the state's business community paid almost $15 billion in taxes - an increase of 36 percent since 2002. At what point does the business community look for better, cheaper options and friendlier states?

I'm glad to see leading business publications giving competitiveness this much attention. It's timely.