Monday, May 23 2016
By Barry Broome, President and CEO, Greater Sacramento Area Economic Council
The perception of California is that costs are too high and the rules are too rigid. Businesses in California succeed on a grand scale. California is the most profitable state to do business in the United States. With fifty-three Fortune 500 headquarters, the state has among the highest number in the country. Even without technology and telecom companies included, (which, as one would imagine, account for a sizable percentage of the state’s GDP), California businesses are still 91 percent more profitable than Texas, 81 percent more profitable than Illinois, and remain on par with New York. When adding tech and telecom back into the mix, profitability over these competitive markets turns into a triple- digit advantage for California.
Profitability takes into account the difference in cost between states. California’s cost of doing business is higher than some competitive markets. Both New York and Massachusetts, however, have a higher average cost of doing business than the Golden State. California companies are so much more profitable than the rest of the nation that any difference in expense is significantly offset by profitability.
California’s Social Climate Draws Young Talent
Californians enjoy some of the most inclusive social and business policies in the nation. From a millennial’s point of view, these types of guarantees (family and medical leave, domestic partner benefits, access to healthcare, pay equity), are essential drivers for their career decisions. California is ideally suited to a young workforce, and the state’s attraction of millennials remains among the highest in the nation.
California is the West Coast Capital of Education
Stanford University is the #4 ranked university nationally according to U.S. News & World Report. UC Davis is ranked #2 in the world for agriculture and for plant sciences. The UC Davis School of Veterinary Medicine is the top school in the world according to QS World Rankings. The California Institute of Technology (CalTech) is ranked in the top ten nationally according to U.S. News & World Report. California schools occupy five of the top 50 slots on the Forbes list of America’s Best Schools. California universities develop research with practical applications and are often deeply integrated into the business community.
California Drives the New Economy
As the Bay Area continues to grow and more businesses find themselves competing for limited space, the Capital Region of California is becoming a shared marketplace. Greater Sacramento is the gateway to Silicon Valley, and is the region into which more and more startups go to scale up. Fresh initiatives and investment are transforming California’s capital into one of the nation’s newest technology hubs.
California is also where the life sciences come to life. San Diego has the highest concentration of life science labs in the U.S., more than San Francisco or Boston. The San Diego region is #1 in the country for patents, #3 worldwide. Venture capital investment in life sciences in San Diego County totals more than $550 million each year. Research and development universities such as the University of California Davis incorporate high tech methodologies into sustainable agricultural practices. Innovations in agricultural technology and seed yields that have been developed in the Central Valley are exported worldwide.
California’s “Creative Economy” encompasses fields like filmmaking, television, and publishing, and accounts for nearly $294 billion of California’s GDP. The Creative Economy employs nearly three times the number of people as the computer and electronic manufacturing sector, and is nearly four percent of the total workforce.
California Offers Same-Day Access to a Third of the U.S. Marketplace
As the ninth largest economy in the world and the largest in the United States, California provides an avid consumer marketplace. 38.8 million prospective customers are on your doorstep. As a first-adopter state, Californians aren’t afraid of discovering new trends. And as California goes, so goes the nation.
California’s position as a leader in the Asia-Pacific marketplace makes the state one of the primary destinations for foreign investment. California is the most popular U.S. state for international companies, and attracts more FDI (foreign direct investment) than any other. Foreign affiliate employment accounts for over 700,000 California jobs.
Above all else, California is a unique brand. Businesses that locate to the state acquire a prestige that is simply unattainable anywhere else. California is a powerhouse economy that creates and fortifies one of the world’s most dynamic workforces. A vanguard in big ideas, a leader in research and education, and the primary destination for foreign investment in the United States, California is open for business.
Visit http://www.expansionsolutionsmagazine.com/california_ed for local economic development office directory listings.