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Governor Patrick addresses state competitiveness at BHI panel discussion

BHI index: Mass. is number 1

BOSTON – Governor Deval Patrick offered remarks on the the Beacon Hill Institute’s Eighth Annual Competitiveness Report at a conference this morning at Suffolk University Law School, 120 Tremont Street, Boston.

The report shows that Massachusetts ranks 1st among all state in terms of its economic “competitiveness,” i.e., its ability to attract and retain business and to provide a high standard of living for its residents over the long run.

A panel consisting of Greg Bialecki, Massachusetts Undersecretary for Business Development, John Regan, Vice President of the Associated Industries of Massachusetts, and Michael George, CEO of OatSystems, Inc., will discuss the report.

The Bay State moved from 2nd last year to 1st this year for its strong showing in human resources, technology, business incubation and security. Massachusetts rose from 9th to 1st in the measure that tracks the number of residents with health insurance coverage. The state also improved its ranking for security, thanks to a decrease in crime.

Massachusetts also continues to outperform all other states in technology, as measured by grants from the National Institutes of Health, new patents, and its high tech workforce. The Commonwealth ranks 1st in venture capital per capita, making it, by that measure, the most attractive state in the union for startups.

Eight of the states that made the top ten last year remained in the top ten this year. Oregon and Montana moved up. South Dakota dropped out, as did New Hampshire, which slipped from 9th to 17th as a result of falling scores for security, fiscal policy and business incubation. New Hampshire ranked 3rd just two years ago.

The BHI competitiveness index is based on a set of 43 indicators divided into eight subindexes – government and fiscal policy, security, infrastructure, human resources, technology, business incubation, openness, and environmental policy. The overall index is an average of the eight subindexes, each of which is itself an average of the indicators making up that subindex. The index ranges from “1” to “10,” with “10” indicating the best state in a category and “1” indicating the worst, and is centered on 5. The breadth of the BHI index distinguishes it from more narrowly focused measures of competitiveness that target just taxes, high tech, or economic freedom.

“The current economic turmoil forces state policy makers to respond with short term solutions,” notes Jonathan Haughton, BHI senior economist and lead author of the report. “The key, however, is to pay attention to the factors that contribute to a state’s economic growth over the long term. The index continues to show that improvement in a state’s ranking can translate into a higher standard of living for state residents. Thus, if a state gains a point in the index, it will also gain $1,546 in real per capita income per year.”

BHI will release its rankings of the top 50 U.S. metropolitan areas in February 2009.

The report is here.

Last updated on 11/24/2008 11:02 AM
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