Massachusetts has made significant strides in CNBC’s annual ranking of America’s Top States for Business, jumping from #38 to #20 in just one year, marking it as the ‘most improved’ state.
However, despite this improvement, the Bay State is still grappling with high costs associated with running a business.
In fact, it is now only slightly cheaper to operate in Massachusetts than in Hawaii, which continues to hold the title of the most expensive state for business operations.
Neighboring states Rhode Island and Connecticut also made an appearance on the list of the ten most expensive states for businesses, reinforcing the financial pressures in the New England region.
In contrast, states like Oklahoma, Ohio, and Indiana emerged as the most affordable locations for businesses.
The CNBC rankings focus on several factors, including operational costs, quality of life, workforce quality, infrastructure, and technology and innovation activity.
Massachusetts excelled in technology and innovation, securing the #5 spot, and ranked #10 in terms of quality of life, just behind Nebraska and ahead of New Hampshire.
This year’s rankings have also introduced new metrics aimed at assessing states’ vulnerabilities in light of potential trade wars and decreasing federal budgets.
The Massachusetts High Tech Council, through a new coalition known as the Mass Opportunity Alliance, has raised concerns regarding the state’s unfavorable cost ranking.
Christopher Anderson, co-organizer of the Mass Opportunity Alliance, expressed worries about how the current tax environment could impact the state’s ability to retain senior executives.
Particularly, the recently implemented ‘millionaire’s tax,’ a 4% surcharge on income exceeding $1 million, could drive these key professionals, who are increasingly opting for remote work, to relocate to states with more favorable tax regimes.
Anderson identified three crucial areas where improvement could positively impact Massachusetts’s business climate.
First on his list were income taxes.
He warned that the state’s new tax structure may complicate efforts to recruit and keep top talent, particularly as remote work becomes the norm.
Following income taxes, he pointed out the pressing issue of energy costs, suggesting that the governor might be working towards better solutions.
Lastly, Anderson highlighted the unsustainable growth rate of the state budget, which he claims has persisted for years.
He indicated that without the revenue generated from the millionaire’s tax, Massachusetts would likely face significant budget cuts, underscoring long-standing issues with debt service, state healthcare costs, and unfunded pension liabilities.
Despite ongoing challenges, Anderson insists there is a robust push from various business groups and officials who are committed to championing Massachusetts’s strengths, including its reputation as the most innovative state in the country.
However, he emphasized the need for more collaborative efforts from different stakeholders, advocating for a focus on addressing critical economic issues rather than pursuing political agendas.
With the gubernatorial race underway, the spotlight remains on Massachusetts’s economic strategies and the potential to uplift its status in future rankings.
image source from：masslive
