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Eye On Olympia

U.S. News: WA tops for starting a small business…

Although there’s a constant “we’re great/we suck” debate on virtually all attempts to gauge Washington’s business climate, here’s the latest one: U.S. News and World Report gives the state high marks as a place to launch your company. Tops, in fact.

From the report:

1. Washington. The Evergreen State tops the list by coming in second on the New State Economy Index and fifth on the Small Business Survival Index. Washington is first among the states in steps toward energy efficiency and using more alternative-energy sources. It also has a highly productive manufacturing sector, signaling high wages and a tech-intensive economy. Washington leads the nation in value added per production hour as a percentage of the national average—the difference in value between inputs in the production process and the value of the units as finally sold. But in addition to these nonpolitical factors, Washington also has very low taxes, making the costs of growing a business quite low. It does not have its own income or capital-gains taxes, either personal or corporate.

The list ranked the top 7 states, in US News’ view. Idaho and Oregon? Sorry.

Hat tip: Northwest Republican.

UPDATE: Among those underwhelmed by the news: Richard Davis, with the Washington Alliance for a Competitive Economy. Davis looked at the underlying studies used by the magazine to create its list, and says the results are skewed, partly because Washington has no income tax.

Writes Davis:

Put the “7 best” article in the entertainment file. Combining a tech-centric index with a flawed small business measure does not yield anything like a “best place to start a new business.” Next week the Legislature convenes, with economic recovery the top agenda item. The fluffy “best places to start a business” story should not become a distraction.


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Richard Roesler covers Washington state news from The Spokesman-Review's bureau in Olympia.

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