newjerseynewsroom.com

Study also ranks state's economy 8th worst

BY TOM HESTER SR.

NEWJERSEYNEWSROOM.COM

The state government’s financial struggles have caused New Jersey to take the greatest tumble among the 50 states as one of the worst states to do business, according to a study by CNBC, which used the Center on Budget and Policy Priorities state budget shortfall data as one of many criteria in developing a list of rankings.

New Jersey fell eight spots in the 2011 review to 30th place overall.

And the state’s economy is ranked 42nd.

Virginia and Texas are ranked first and second as the best states to do business, positions that have traded annually since the annual review began in 2007.

The study measured the states on 43 metrics in 10 categories of competitiveness. The categories were weighed based on how frequently the states use them as selling points to attract business. That way, states were held to their own standards.

The categories and weightings, for a total of 2,500 points, were: cost of doing business (350 points), workforce (350 points), quality of life (350 points), infrastructure and transportation (325 points), the economy (300 points), education (225 points), technology and innovation (225 points), business friendliness (200 points), access to capital (100 points), and cost of living (50 points).

New Jersey garnered 1,523 points.

“The biggest overall decline came in New Jersey, which fell eight spots this year to 30th place overall largely because of the state’s budget situation — one of the worst in the nation,‘’ the study declared. “New Jersey is no garden spot when it comes to the economy, which ranked 42nd in our study this year.’

Virginia garnered 1,660 out of the 2,500 points and Texas was given 1,578 points.

North Carolina, the state where most New Jerseyans go when they move out of state, is ranked the third best state for doing business. Pennsylvania is ranked 12th, up from 20th in 2010; New York 26th, a decline from 24th, and Delaware 36th, up from 42nd. Rhode Island, ranked 50th, is considered the worst place to do business.

Virginia is considered to have a strategic location, friendly business climate and diverse economy.

The study found Ohio as the most improved state, jumping 11 places to 23rd, as a result, the study found, of a huge improvement in cost of doing business. Ohio improved to 5th place in the important category, from 29th place last year. A multi-year effort to reform the tax code in the state is paying off with a tax structure that welcomes new investment. At the same time, wages have fallen in Ohio relative to other states, the study found. That helps businesses on the cost side, but workers suffer.

The study may be a topic on Friday when the New Jersey State League of Municipalities holds it annual half-day economic smmit at Rutgers University’s Bloustein School in New Brunswick.

A panel of experts will analyze New Jersey’s economy from the state, regional and national perspective, and its recovery from the recession. The panel will also explore the recession’s fiscal impact, on both the statewide and local levels, and discuss which business strategies and options make sense for New Jersey going forward.

Led by James W. Hughes, dean of the Bloustein School of Planning and Public Policy, the panel will include, Dennis Bone, president of Verizon and chairman of Choose NJ; Thomas A. Bracken, president and CEO of the New Jersey State Chamber of Commerce; Henry Coleman, professor of Public Policy at the Bloustein School; former Gov. James J. Florio; Robert Kuttner, managing director of U.S., state, and local ratings for Moody’s Investor Service; Woodbridge Mayor John McCormac; Tom Neff, state Director Division of Local Government Services director; David Rosen, legislative budget and finance officer for the state Office of Legislative Services; Rae Rosen, assistant vice president and senior economist for the Federal Reserve Bank of New York, and state Treasurer Andrew P. Sidamon-Eristoff.

Correction: The facts detailed in the article “State government's bad financial situation makes New Jersey the 20th worst state to do business in,” are not from a study by the Center on Budget and Policy Priorities. The facts are from an annual review compiled by CNBC. The television news station used the Center on Budget and Policy Priorities state budget shortfall data as one of many criteria in developing the rankings. NewJerseyNewsroom.com regrets the error.