Wednesday, December 19, 2007
Frank Conte, Communications
of first but still strong where it matters: Massachusetts
finishes second in State Competitiveness Report 2007
(December 19, 2007) - After three years at the top,
Massachusetts slipped to second place, just behind Utah, according
to the most recent annual measure of state competitiveness
compiled by the Beacon Hill Institute.
Bay State slipped slightly in small number of the component
categories of the competitiveness index, including higher
minimum wages, a higher crime rate and failing to show any
progress in resolving longstanding problems such as high housing
costs and aging infrastructure. Nonetheless, Massachusetts
continues to rank in the top ten based upon strong showing
in the human services, finance, and technology subindexes.
state is the only new entrant to the top ten this year, improving
from 13th to 7th place. Montana shows the largest improvement
this year, moving up from 28th to 15th position. The largest
drop in rank this year belongs to Michigan, moving down seven
places from 34th to 41st. New Hampshire slipped from third
place to ninth in the latest ranking.
year, New Mexico and Rhode Island, two fast moving states,
climbed up 9 and 4 places, respectively. New Mexico is now
ranked 29th and Rhode Island 21st. Also improving were Minnesota
(ranked 6) and Tennessee (37) and Missouri (26). Oklahoma
(32) also improved remarkably.
BHI competitiveness index is based on a broad set of 42 indicators
divided into eight subindexes: government and fiscal policy,
security, infrastructure, human resources, technology, business
incubation, openness and environmental policy. This broad
view distinguishes the BHI index from more narrowly focused
measures of competitiveness that target just one dimension
such as taxation, or high tech, or economic freedoms.
trying to develop sound economic strategies, policymakers
often look to "leading technology states" (LTS)
as a guide. This may be too narrow, suggesting the limits
of targeted industrial policies. These high technology states
do not always prove to be competitive by the institute's measure.
Massachusetts (2) and Minnesota (6) are the only leading technology
states to finish in the top ten in the 2007 BHI index. Other
LTS states - California (24), Connecticut (25), New Jersey
(43), New York (38), North Carolina (30) Pennsylvania (34)
and Texas (20) - have relatively unimpressive rankings.
BHI index forces policymakers to consider what really matters
to the health of a state's economy: the productivity of its
firms. "In contrast to recent overblown reports of job
losses in Massachusetts, the BHI competitiveness index shows
that the Commonwealth has important long-run strengths,"
said Senior Economist, Jonathan Haughton. "These continue
to translate into higher real levels of per capita income.
We find that if a state has an extra point in the index, its
personal income will be higher by $1,163 per person per year."
latest report is available at www.beaconhill.org. BHI will
release its annual rankings of the top 50 metropolitan areas
in the United States in late February 2008.
State Report (PDF)
Release in PDF
50 state listing
out how your state ranks on the BHI index
year comparison (Download Zip File)
12/19/2007 8:47 AM
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