Pennsylvania's Economy Struggles to Compete
In three separate studies on the state's economic competitiveness and business climates, Pennsylvania remains near the bottom of the pack.
The 2012 Alec-Laffer Economic Competitiveness Index, ranks states economic performance and outlook (1 being the best, 50 the worst). According to the index, the Keystone State ranks 40th in economic outlook for 2012 thanks to several factors, including:
- 50th in Top Marginal Corporate Income Tax Rate
- 32nd in Top Marginal Personal Income Tax Rate
- 50th in Levying Estate/Inheritance Tax
- 45th in Remaining Tax Burden (additional taxes beyond those already ranked)
- 41st in Recently Legislated Tax Changes
Another study by ChiefExecutive.net placed the Keystone State as the 43rd best state for business—a four position drop since last year. CEOs found, "Pennsylvania...is regulation heavy even for very small 1-2 person businesses," this despite a "positive" ranking in the development trend indicator as a result of the natural gas boom.
The general business climate is one thing, but how is the outlook for small businesses? The Thumbtack.com/Kauffman Foundation Small Business Survey found that Pennsylvania's small business climate is mediocre, earning a C for overall friendliness to small businesses. Although the survey gave business start ups a C+, the commonwealth received a C- for hiring regulations, and a D in jobs training programs.
Pennsylvania remains a relatively unattractive place to begin or operate a business. Crippling taxes, heavy regulation, and burdensome bureaucracy have held back the Keystone State's economic growth.