Chamber report cites strengths, drawbacks in state quest for economic growth
Kentucky has serious work to do to become a more competitive place to do business and achieve economic prosperity, according to a new report from the Kentucky Chamber of Commerce.
Ready for Jobs? examines how Kentucky compares to other states on key indicators of a competitive business environment and finds the state coming up short in such areas as health, education and tort liability but performing relatively well in the cost of living and cost of doing business.
The report, which includes recommendations for improvement, also addresses the importance of protecting and promoting such key sectors as coal, bourbon, manufacturing and the equine industry.
Here is a closer look at the state’s strengths and weaknesses in key areas as reported in Ready for Jobs?
- Low cost of doing business
- Low cost of living
- Seventh-lowest energy costs in the country
- Top tier of states for economic growth from 2009-2010
- 47th in per capita income
- Fifth 5th in the number of citizens living below the poverty level.
- Citizens less likely to improve their economic standing at the end of their prime working years than are typical Americans
Regulatory and Tax Environment
- Ranked in the top half of states in the State Business Tax Climate Index, based on the impact of five major taxes: corporate, individual income, sales, unemployment insurance and property
- Ranked among the worst states for tort liability in the Tort Liability Index
- Ranked 30th in overall regulatory environment (costs imposed by government)
- Ranked 30th in state and local tax burden as a percentage of income
- Relatively low health insurance costs when compared to other states
- Workers’ compensation rates slightly below average
- No right-to-work law.
- Above the national average for unemployment insurance employer contributions as a percent of both taxable wages and total wages
- Significant progress in increasing college enrollment and the number of degrees awarded
- Dramatic improvement in national ranking on key education indicators, including K-12 achievement
- Low overall education attainment
- ACT scores trail national average
Health/Quality of Life
- Low cost of living
- Low crime rate
- Health status ranked 43rd with high rates of smoking, obesity, cancer deaths and preventable hospitalizations
- Ranked 49th in the Gallup-Healthways Well-Being Index
- Ranked 14th overall in state highway system performance
- Motor fuel taxes below national average
- High highway fatality rates
- Urban interstate congestion
Government Spending and Debt
- Progress in limiting spending growth in Medicaid, corrections and public employee health insurance
- Medicaid managed care expanded statewide
- Sentencing reforms enacted to reduce the prison population
- Spending increases in public employee health insurance reduced to 2% per year.
- State spending per capita ranked 20th
- State debt as a percent of income 12th
- Ranked 8th in state pension debt measured as percent of income
- Identified as among the worst states in the country in terms of pension funding
The full report was released at the Chamber’s Business Summit and Annual Meeting, presented by Bingham Greenebaum Doll, LLP, on July 17.
“It is our hope the information in this report will promote action to create policies that will help businesses grow, create good jobs and build a stronger future for all Kentuckians,” said Dave Adkisson, president and CEO of the Chamber. “We stand ready to work in a constructive partnership with policymakers and other businesses and organizations to achieve our shared goal of moving the state forward.”