California worst state for business, survey says

May 6, 2011
By JAN NORMAN
THE ORANGE COUNTY REGISTER

California is the worst place state in which to do business, according to a new survey of chief executives by Chief Executive Magazine.

It is the third straight year that California is ranked very last on the magazine's list of Best and Worst States.

The magazine asked 550 CEOs nationwide to evaluate states on such issues as regulations, tax policies, workforce quality, education resources, quality of living and infrastructure.

The CEOs rated California's quality of life four out of five stars, but its taxes and regulation earned one star and the quality of its workforce, once thought to be the state's strong point, only three stars.

"ABC - Anywhere But California," T.J. Rodgers, CEO of Cypress Semiconductor, a $668 million San Jose chip maker told the publication.

"It's horrifically expensive, it's very hostile to business, and its environmental regulations are more of a drag on business than protecting the environment."

Cypress Semiconductor's staff in California peaked at 1,500. It's now about 600, Chief Executive said.

Click on the photo to the left to see a slide show of the top ranked states and the reasons for their high marks, according to CEOs.

"Our survey, year-over-year proves that those states with the worst records continue to practice the same policies that alienate businesses," said JP Donlon, editor-in-chief of Chief Executive magazine.

"As the nation's economic problems continue to snowball and an increasing number of states experience budgetary problems, state governments ought to take a hard look at their taxation and unionization policies if they want to turn the page and attract new businesses and capital to their provinces.

"A handful of states have made business-friendly policies a priority," he added.

Texas tops the list for the second year. It rated five stars in all three categories.

"While the Lone Star State may not be perfect - many leaders would like to see improvements in its education system -- it is Periclean Athens compared to California in the eyes of the 550 CEOs surveyed for Chief Executive's seventh annual report on the best and worst states in which to do business," the publication said.

With finances in shambles due to the weak economy, many states have been increasing tax rates, the publication notes.

"Today's 'soak the rich' mentality hits business leaders especially hard," says Marshall Cooper, CEO of Chief Executive magazine and ChiefExecutive.net. "CEOs and entrepreneurs vote with their feet - and also pack up many jobs and investment with them when they leave."

The worst states, according to Chief Executive, are:

50. California

49. New York

48. Illinois, which fell 3 spots. It recently sharply raised taxes

47. New Jersey

46. Michigan, which improved two spots

Over the past five years, Illinois has fallen 40 spots. In 2006 the state ranked 8th.

At the other end of the scale, Oklahoma is the state that has risen the most in the rankings over five years, now 11, compared to 31 in 2006.

Some states significantly improved their ranking in 2011 including:

•Wisconsin, which now ranks 24 compared to 41 in 2010

•Louisiana, at 27, up from 40

•Indiana, ranking 6 compared to 16 last year

•Kentucky, at 17, compared to 23 in 2010

Those states whose ranking declined the most are:

•Alaska at 31, down 10 spots

•West Virginia at 42, down 8 spots

•Pennsylvania at 39, down 7 spots

•Idaho at 19, down 6 spots

•Alabama at 26, down 6 spots

Click link below for complete results and individual state rankings.

http://chiefexecutive.net/best-worst-st ... r-business

http://www.ocregister.com/articles/-299331--.html