“Bubble Watch” digs into trends that may indicate economic and/or housing market troubles ahead.
Buzz: California continues to be very unfriendly to business, a trait that could harm the states economy.
Source: Chief Executive magazine.
Trend reported: For 14 consecutive years, this magazine has polled CEOs about their opinions of state business climates. And for the 14th consecutive year, California takes last place for business-friendliness.
Dissection: Its become a rite of spring. Chief Executive magazine decries Californias perceived anti-business attitudes.
This year, the magazine writes: “While the state attracts an outsize portion of entrepreneurs and (venture capital) financing, there are flies in the tanning lotion. High taxes, high costs and thickets of regulation remain turnoffs. The biggest problem is popping up at the grassroots level: Housing and other costs are so out of whack in the Bay Area that it is losing skilled workers to other parts of the country.”
The CEOs favorites for 2018 were … Texas (14th straight year as tops), then Florida, and a tie between the Carolinas for third.
And how California fared in CEO rankings by three economic components:
1. Workforce quality: California was No. 33. Tops was Iowa, then Utah and Delaware.
2. Living environment: California got 34th place. Best score went to Colorado, then Utah and New Hampshire.
3. Taxes and regulation: California was No. 50. South Dakota was highest ranked, then Wyoming and Texas.
Another view: When data crunchers at WalletHub ranked state economies by statistical performance, California was seen as the nations fourth-best business climate. Yes, No. 4!
The analysis of 28 key indicators found Washington tops, followed by Utah and Massachusetts.
When it came to slicing into the rankings, California got a pair of third-place scores by WalletHubs math: for “economic activity” behind Washington and Utah; and for “innovation potential” behind Massachusetts and Washington.
However, WalletHub did give California a poor grade for “economic health” — a 32nd ranking. No. 1 was Utah followed by Idaho and Colorado.
PS: Since 2005, when Chief Executive magazine started their state rankings, Californias gross domestic product has grown at a 2 percent annualized rate. Thats ninth-best performance among the states (North Dakota, Texas and Utah were 1-2-3). And California outpaced the national average of 1.5 percent a year, not bad for the “worst” state to do business in!
How bubbly? On a scale of zero bubbles (no bubble here) to five bubbles (five-alarm warning) … ONE BUBBLE. You could ignore the CEO opinions since history suggests their dislike of California is based on more than economics, but WalletHubs weakness in Californias “economic health” is worrisome.
ICYMI: Bubble Watch: Are house hunters shying from newly built homes?
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