In the latest issue of “Chief Executive” magazine, results were published for the “Best and Worst States for Business 2010,” based on a January survey of 651 CEOs from around the country. The business leaders rated the business climates of all 50 states and the District of Columbia on: a) taxation and regulation, b) quality of workforce, and c) living environment. For the second year in a row, Texas ranked #1 in the country while California ranked dead last at #51 for the second straight year. California was the only state in the nation to get a letter grade of “F” from the CEOs for the category “Taxation and Regulation.”
The trends in employment levels in California and Texas support the stark differences in the CEOs’ rankings of the two states. California lost more than a million jobs during the recent 2008-2009 recession, and there are actually fewer jobs in the Golden State today than there were ten years ago (see chart above). In contrast, job creation in Texas barely even slowed during the worst recession in a generation, and Texas has 151,000 more jobs today than when the recession started in December 2007, and 1.11 million more jobs than a decade ago.
See longer post at the Enterprise Blog.
Bottom Line: The new CEO survey provides insights into the dramatic differences between the economies of our two largest states. The low-tax, business-friendly, right-to-work state of Texas gets high marks from CEOs and provides a model for how a state can attract jobs, businesses and economic development. On the other hand, the high-tax, big-government, forced unionism approach of California has been a prescription for high unemployment and a net outflow of jobs, people and businesses. If the unionacracy of California wants to rescue its economy from being the “Venezuela of North America,” it should look to Texas for lessons on how to do it.