Florida is accustomed to getting high marks in surveys and rankings of business-friendliness, but in a new CNBC analysis, the Sunshine State ranks 11th among top states to do business — a respectable showing but not among the upper echelon the state occupies in other rankings.
That’s likely because the CNBC analysis takes into consideration more than just tax and regulation policies. It weighted 10 categories — workforce (16%); infrastructure (15%); cost of doing business (14%); economy (13%); life, health and inclusion (13%); technology and innovation (10%); business friendliness (8%); education (7%); access to capital (2%); cost of living (2%).
Florida ranked above average in most categories, but its score was dragged down by the categories of cost of doing business (30th); life, health and inclusion (39th); business friendliness (39th); and cost of living (27th).
The middling ranking for cost of doing business might be a shock because of Florida’s relatively low business taxes, but the CNBC analysis used other factors in making their determinations.
“We also measure wage and utility costs, as well as the cost of office and industrial space. And we consider incentives and tax breaks that states offer to reduce business costs, with special emphasis on incentives targeted toward development in disadvantaged communities,” the report explains.
The business friendliness category, too, might be surprising to Florida’s business boosters, but the methodology points to an issue the Florida Chamber of Commerce and other business lobbies have bemoaned for years: lawsuits.
“Companies follow the path of least resistance,” the report states. “That includes a legal and regulatory framework that does not overburden business. We measure each state’s lawsuit and liability climates, regulatory regimes covering areas such as trade and labor, as well as overall bureaucracy.”
The top five states in the rankings are North Carolina, Washington, Virginia, Colorado and Texas. The bottom five are Hawaii, New Mexico, Louisiana, Alaska and Mississippi.