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Wed July 2, 2014
Business Climate: Is Connecticut Really That Bad?
A recent study saw Connecticut drop once again in the ranking of business-friendly states. According to CNBC, we’re now among the bottom five states in the nation in terms of our business climate.
There is a view out there, however, that things may not be so bad after all.
Over recent years, Connecticut has become the state business organizations love to hate. CNBC’s rankings embody that downward slide. In 2007, we ranked 31st, in the bottom half, but not yet perhaps in dire straits. Over the seven years since, we slid to 34th, then 35th, and down to 39th. Over the last three years, we’ve gone from 44th to 45th, and now to 46th.
How fair, though, is Connecticut’s last-five placing? Maybe not entirely, according to Peter Gioia, chief economist for the Connecticut Business and Industry Association. “Data for that really mainly came from before the beginning of this year, before the beginning of the session and before we’ve had four months of job growth and steadier performance in the economy,” he said.
Gioia said a poor economy and high business costs were the two factors that dinged Connecticut’s ranking the most. One of those, the economy, has started to turn the corner. He also said the Malloy administration has made strides in the regulatory area, eliminating 1,000 pages this year of outdated regulation, and reforming business practices at key agencies, such as DEEP, to streamline business permitting.
But it’s not all improvement. The cost of doing business is still high; our energy costs remain above average, and our transportation infrastructure is in dire need of investment. “The economy, jobs, economic performance, [and] a willingness to create an environment that people want to invest, are all factors that really have to be dealt with pretty seriously by all policy makers, not just at the gubernatorial level,” Gioia said.
CBIA has made the business climate its number one priority this year, launching its 20 by 17 campaign, which wants to see the state in the top 20 within three years.
Gioia warned that we may have to run just to keep up. "The other states aren't standing still," he said. "We’ve had some significant tax reform, particularly our neighbor in New York regarding business costs, so we’ve got a lot to do."
CBIA said that while programs like the controversial First Five may be unavoidable in a competitive environment, the investments that will see the biggest returns are those that benefit all companies by making this an easier place to do business.