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BHI releases Metro Area and State Competitiveness Report 2006

For the third year in a row, The Beacon Hill Institute has found that Massachusetts outranks all other states in terms of its economic competitiveness. Despite persistent worries about population loss, the threat to its high tech base and high housing costs, the state’s economic fundamentals are strong, making it the state most able to sustain a high standard of living for its residents and best equipped to enjoy economic growth over the long term. It reaches this finding in its 6th annual State Competitiveness Report, released today.

BOSTON – Massachusetts continues to rank number one for economic competitiveness. According to its latest study, entitled State Competitiveness Report 2006, the Bay State leads the nation across a broad variety of economic indicators. Two states that finished second and third last year, Utah and New Hampshire, also ranked second and third this year.

The Institute defines competitiveness as “the policies and conditions that ensure and sustain a high level of per capita income and its continued growth.” The 2006 Report assigns 42 variables to eight categories – government and fiscal policy, security, infrastructure, human resources, technology, business incubation, openness, and environmental policy – and combined these eight measures into a single “competitiveness index”

“Massachusetts’s continued strong showing is sure to confound the pessimists among us,” said David G. Tuerck, BHI Executive Director. “But the facts are clear: on key measures the Commonwealth is fundamentally strong.” He added, “Dwelling on the bad news based on one or two economic indicators such as the high cost of housing or the loss of population is certainly missing the forest for the trees. Diverse in its economic makeup, Massachusetts continues to be an attractive place to live and work. Other states would be wise to look at our
state’s fundamentals.”

Massachusetts rises to the top based on its competitive advantages in technology, business incubation, human resources and openness. For all seven indicators comprising the technology subindex, Massachusetts was in the top five states. These strengths more than offset areas in which the state performs poorly – for example, infrastructure and government policy.

Colorado, North Dakota, Idaho and Wyoming, Minnesota, South Dakota and Virginia rounded out the top 10 this year. The report shows that even so-called rural states such as North Dakota, South Dakota, Idaho and Wyoming can be competitive. These states benefit from strong infrastructure and environmental policy ratings as well as adequate openness, business incubation and human resources. In contrast Missouri and Maryland dropped dramatically compared to last year’s ranking. Missouri dropped 14 spots to 31st due to increases in crime and pollution.. Meanwhile, Maryland dropped 13 places to 23rd primarily because of an increase in travel time to work and higher than nationwide average increase in prices for electricity.

BHI published this year’s Competitiveness Report in conjunction with Suffolk University’s Centennial celebration. BHI will release the complete 2006 report that includes rankings of the top 50 Metropolitan areas in the United States in late February 2007.

PDF Press Release file with Tables

Complete Report in PDF

Last updated on 12/19/2006 8:18 AM
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