December 17, 2002
Study: High taxes, debt, and job-creation costs lessen New York's competitiveness; technology strengthens it
A new study offers new evidence that New York's competitiveness would improve if it cut its overall tax burden, government debt, and other costs of job creation, including workers' compensation and electricity costs.
The study also highlighted New York's strength in technology as a strong competitive advantage.
The Metro Area and State Competitiveness Report 2002 shows these costs of job creation affecting the competitiveness of Buffalo, Rochester, and New York City. The Beacon Hill Institute of Suffolk University in Boston released the report December 10.
The study ranked the competitiveness of the nation's 50 largest metropolitan areas. In the study, New York City, Rochester, and Buffalo ranked 37th, 41st, and 49th, respectively. Seattle, San Francisco, and Boston were judged the nation's most competitive metropolitan areas.
The study weighed more than three dozen variables to evaluate each metropolitan center in 11 different categories, including government and fiscal policy, infrastructure, technology, finance and costs, openness to business, and environmental policy.
The study showed that:
Rochester, and New York City ranked 50th, 49th, and 48th
, respectively, in the study's government and fiscal policy
sub-index. Taxes, workers' compensation costs, bond ratings,
and costs of unemployment insurance were all cited as competitive
"Business are most likely to be attracted to areas with moderate tax rates and clear evidence of financial discipline," the report noted.
and Rochester were ranked 43rd and 48th, respectively, on
the finance and costs sub-index, with high costs of living
cited as a competitive disadvantage in both cases. New York
City's high costs of living were also cited as a competitive
disadvantage, but it ranked 11th in this category, mostly
because of its high concentration of wealth as indicated
by bank deposits per capita.
all three cities, technology was cited as a competitive
advantage. The report specified such factors as academic
R&D funding relative to employment, National Institutes
of Health support to institutions per capita, patent productivity,
and the population of students and professionals in technological
costs of electricity were cited as a competitive disadvantage
for all three cities in the environmental policy sub-index,
on which Rochester (38), Buffalo (47), and New York City
(46) were all ranked in the bottom third of metropolitan
from crime was identified as a competitive advantage in
all three cities. Buffalo, Rochester, and New York ranked
4th, 5th, and 20th, respectively, on this subindex.
The study deemed a metropolitan area competitive if it had in place "the policies and conditions that ensure and sustain a high level of per capita income and its continued growth," the report said. "To achieve this, a metro area needs to be able both to attract and incubate new businesses and to provide an environment that is conducive to the growth of existing firms."