Utah Heads The Best States For Business 2014
The national unemployment rate recently dipped to 5.8%, a level last seen in July 2008, but the economic recovery has hardly been robust. Voters went to the polls last week and expressed their dissatisfaction. The economy is the most important factor for voters and seven out of 10 said it is still in bad shape.
Yet, pockets of the U.S. are prospering with strong business climates. You need to head west to find most of these spots. Eight of the top 10 states in Forbes’ annual study of the Best States for Business are west of the Mississippi. Leading the way is Utah, which previously ranked first between 2010 and 2012 before dropping to third last year.
The Best And Worst States For Business 2014
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mandicoleman.com/Getty Images/Flickr RF#1 Utah
2013 Rank: 3
Gross State Product: $141 billion
5-yr annual GSP growth: 2.4%
Governor: Gary Hebert
Utah moves back to the top spot where it ranked for three straight years from 2010 through 2012. The state has a very pro-business climate and companies benefit from energy costs that are 26% below the national average and third lowest in the U.S.
Total U.S. employment declined between 2008 and 2013, but Utah added jobs at a 0.6% annual clip, good for fourth best in the country. The gains are expected to continue with both Moody’s Analytics and EMSI forecasting top 10 growth rates for jobs over the next five years using “top down” (Moody’s) and “bottom up” (EMSI) methods. Utah also has the highest household incomes among the 10 states with the best job growth forecasts over the next five years.
Utah has a very pro-business climate, and companies benefit from energy costs that are 26% below the national average—third lowest in the nation. Utah’s economy expanded 2.4% a year over the past five years—fifth best in the U.S. It is the only state to rank in the top 10 in five of the six main categories we used to determine the Best States.
Utah has become a technology hub in recent years, but its tech roots run deep. In 1985, it was home to two of the three largest software companies in Novell and WordPerfect (Microsoft MSFT +0.03% rounded out the top three). Novell and WordPerfect have long been swallowed up, but Utah continues to be a hot locale for technology firms.
EBay has been in Utah since 2000, and it began an expansion last year to add 1,600 more jobs and almost double its workforce in the state. “The talent pool in Utah is incredible,” Scott Murray, vice president of global customer experience, told the Associated Press last year citing the availability of software engineers and Mormon missionaries with foreign language skills.
Oracle ORCL +0.77% announced an expansion to its Utah operations this year, which will add more than 300 jobs. Other tech firms with a heavy presence in the Beehive State include Microsoft, Twitter TWTR -2.63% and Adobe Systems ADBE -1.75%. Only five states received more venture capital funding than Utah in the first three quarters of 2014, according to the National Capital Venture Association (Washington just barely eked ahead of Utah). Most of the money is going to tech startups in either the Provo or Salt Lake City areas.
In addition to software and IT, life sciences is a targeted industry for Utah’s economic developers. Medical device firm Varian Medical Systems kicked off an expansion in August to add 1,000 new jobs, which will more than double its presence in Salt Lake. There are nearly 1,000 life sciences companies in Utah, and all major subsectors of the industry are experiencing faster employment growth than the U.S. average.
Financial services is another targeted area for Utah developers, and they can point to Goldman Sachs. The firm has 1,700 employees in Salt Lake, which serves as its second biggest office in the Americas. The company expects significant growth in Utah over the next two to four years.