Every summer, CNBC examines each state’s business climate using various categories in order to create a ranking for the business climate of all fifty states. As they explain:
Each category is weighted based on how frequently states use them as a selling point in economic development marketing materials. That way, our study ranks the states based on the attributes they use to sell themselves. We developed our criteria and metrics in consultation with a diverse array of business and policy experts, and the states. Our study is not an opinion survey. We use data from a variety of sources to measure the states’ performance.
So how did West Virginia do in CNBC's 2023 study? The state finished 46th – down two from last year’s 44th ranking. Upon closer examination, the state stayed close to their usual score in most of the survey’s eleven categories. Improvements occurred in the access to capital, cost of doing business, education, and cost of living categories while the state’s economy and workforce showed declines. Here is CNBC’s comparison to last year’s results:
Okay, now that the Republicans control all facets of West Virginia’s government, have they improved the state’s business climate as they promised to do before taking power? Two years ago, I put together a chart using the CNBC rankings for various years. I’ve just updated that chart by adding this year’s ranking on the left. Note -- for comparison’s sake, I included 2021, 2019, 2017 (Republicans passed major business-friendly legislation), 2014 (the last year that the Democrats controlled both the executive and legislative branches), and 2007 (the survey’s first year). Here is my updated chart:
My conclusion: except for the improvement in “cost of doing business” which improved from #18 under the Democrats in 2014 to #1 this year with the Republicans, it would appear that the ascendency of the Republican Party in West Virginia has made little difference in the state’s overall business climate.* The last time (2021) I wrote about WV and the CNBC survey, I concluded:
It’s not hard to see that, with a couple of minor exceptions, West Virginia’s rankings have not significantly changed over the years. This relative consistency of rankings is despite a major change in who controls the legislative and executive branches. Through the last decade, the Republicans regularly ran on making the state "pro-business" and to that end, they passed major legislation (right to work, prevailing wage, and other business-friendly laws) upon taking over the legislature. Has it made a difference? I’m not an economist but the CNBC numbers do not reflect any seismic shift in how the state’s business climate is perceived.
In the past, my subscribers have often reacted to the CNBC rankings. Hey, if you have some thoughts, drop me a note.
Note --- reader comment below
*I also realize that there are several factors that are out of the ruling political party’s control. (The larger national economy and epidemics come quickly to mind.)