Repeat performance: Virginia holds top spot in rankings

by Heather B. Hayes
for Virginia Business
September 2007

The Virginia economic development officials can continue to say “We’re No. 1” for at least another year.

The commonwealth kept its top ranking in Forbes.com’s list of the best states for business and added another new accolade as CNBC’s “Top State for Business.” Such recognition is serious business for the Virginia Economic Development Partnership. It has made full use of the Forbes.com ranking in its PR/marketing efforts since last summer, even incorporating the slogan “Best State for Business” into a logo.

No one can pinpoint how much these rankings help in attracting companies and creating jobs. But Gov. Timothy M. Kaine believes that the accolades give Virginia an edge in head-to-head competition with other states. That’s especially true when foreign companies are opening their first facilities in the United States.

“Because it’s not their home market, executives at these firms often have a high degree of anxiety about making sure that they make the right decision about where they locate,” Kaine said in an interview with Virginia Business.
“They would expect the governor of every state to say great things about their state, but when you have an independent, neutral source like Forbes.com or CNBC that verifies Virginia’s pro-business status, it makes them feel a lot more comfortable. It’s a very, very powerful selling point.”

Forbes.com bases its rankings on 30 metrics in six broad categories: business costs, economic climate, growth prospects, labor, regulatory environment and quality of life. Virginia’s business-friendly attributes this year included one of the nation’s best incentive environments and the third-lowest unemployment rate.

CNBC’s competition, be-gun just this year, is based on 10 categories, including cost of doing business, technology and innovation, quality of life and access to capital. While Virginia is “not a flashy performer,” according to CNBC, never finishing higher than third in any category, it is extremely consistent. The state stumbled in only one category, cost of living. Expenses in Northern Virginia dragged the commonwealth down to No. 35.