Survey: Pennsylvania 18th least favorable to business
By Caleb Taylor | PA Independent
HARRISBURG — Employers in Pennsylvania might not enjoy the best business climate in the country, but at least circumstances are looking up, according to a pair of recent surveys.
A survey of 322 corporate executives released on Monday by Development Counsellors International, a New York-based marketing firm, ranked Pennsylvania as the 18th least favorable state to do business in.
Texas and North Carolina top the rankings as the best, while New York and California are at the bottom. Pennsylvania is ahead of New Jersey, even with Ohio and behind Maryland and West Virginia, according to the survey.
Business groups say the results of the survey are not surprise considering Pennsylvania’s tax and regulatory burden.
“Small business owners are in a dour mood because of the uncertainty they are hearing out of Washington,” said Kevin Shivers, director of the National Federation of Independent Business, which represents small businesses in Pennsylvania. “Small businesses, under the previous administration in Pennsylvania, weathered raised income taxes, (a higher) minimum wage, (more expensive) license fees … and no regulatory reform.”
The survey from Pennsylvania Chamber of Business and Industry, an organization that lobbies on behalf of business interests, gives Pennsylvanians a reason to be optimistic about the economic future, if only slightly.
The survey released in early September and conducted by Susquehanna Research and Polling, a Harrisburg-based polling firm, showed:
- 18 percent of respondents believe the business climate has improved in the past 12 months, up from 10 percent a year ago and a five-year high.
- 16 percent rated Pennsylvania as a “very friendly” place to do business.
- 66 percent said the state is “somewhat” business friendly.
- 14 percent said it is “not at all” business friendly.
According to the federal Bureau of Labor Statistics, the unemployment rate for the nation stands at 9.1 percent. The rate is 8.2 percent in Pennsylvania, but has climbed in each of the past two months.
State Sen. John Gordner, R-Columbia, chairman of the Senate Labor and Industry Committee, pointed to the passage of tort reform legislation and the decision to continue phasing out the capital stock and franchise tax — a tax businesses pay on goods they are unable to sell — as steps in the right direction.
“There’s no doubt, nationally, that we are still in a downturn,” Gordner said. “But speaking with my local businesses, they are at least optimistic about the direction that Pennsylvania is heading.”
However, Democrats argue that what they are hearing out of Washington, D.C., is exactly what is needed to improve economic conditions in Pennsylvania.
“I hope (Gov. Tom Corbett) and (state) Secretary (of Transportation Barry Schoch) will be getting money so we can start putting people back to work,” said state Rep. William Keller, D-Philadelphia, minority chairman of the House Labor and Industry Committee, referring to the recently announced proposed jobs program launched by President Barack Obama.
According to the White House, the $447 billion American Jobs Act would spend $1.37 billion on “modernizing” infrastructure in Pennsylvania while possibly supporting 17,900 jobs in the state. The reductions in payroll taxes would save a typical Pennsylvania household — making the state median of $48,000 annually — about $1,500 in taxes.
Republicans, who hold the majority in the state House and Senate, plan to pursue more business friendly agenda items in the fall, including changes to how the state sets pay levels for public work projects and reform of the state’s unemployment compensation system.
Keller said the bills in front of the House Labor and Industry Committee for the fall were generally anti-labor.
Steve Kratz, press secretary for the Department of Economic and Community Development, said there is an interest within the Corbett administration to reduce the corporate net income tax from 9.99 percent to 6.99 percent.
Pennsylvania has the highest corporate net income tax in the United States. The corporate net income tax is a tax on businesses’ net profit.
