NC’s top business ranking obscures the growing needs beyond big ribbon cuttings | Opinion

State politicians competed for credit this week after CNBC named North Carolina the best state for business for the second year in a row.

The pols can take their bows, but North Carolinians should hold off on a standing ovation.

Yes, North Carolina is growing, its economy is strong and major corporations – among them Honda, Toyota, Google, Apple, Fujifilm Diosynth and Eli Lilly – are opening new plants and facilities and are creating high-paying jobs.

But these headline events, while triumphs for economic developers, are only a part of the state’s overall economy.

The wider economy tells a more complex story. The same day that North Carolina topped the CNBC rankings, the financial website SmartAsset released a different ranking: North Carolina’s 10 poorest counties. In those counties, all in the eastern part of the state, the median income is more than 30 percent below the state median of $60,516. In all 10, the median home value was less than $135,000 – with two having median home values under $45,000.

There are multiple problems with the accuracy and lack of context in ranking state business climates. The problems begin with the question of whether – given the range and disparities in commercial enterprises – a statewide business climate even exists.

Certainly the administration of Gov. Roy Cooper and the leadership of the Republican-controlled General Assembly deserve credit for wooing big corporations to invest here. But crowning that success with a mythical best-state-for-business title reinforces legislative actions that favor big businesses but are harmful to the state as a whole.

State Senate leader Phil Berger seized on the CNBC ranking as an affirmation that tax cuts primarily benefiting corporations and the wealthy, along with reductions in regulations, have fueled North Carolina’s economic surge.

Berger said that North Carolina won back-to-back No. 1 rankings from CNBC because Republicans have stayed the course of tax cutting and stingy spending since winning control of the General Assembly.

“We’ve overcome partisan obstructionism, regional competition, and economic uncertainty, and have confirmed that our state’s reputation and economy are stronger than ever,” Berger said in a statement. “Republicans had a vision and plan when we won control of the General Assembly back in 2010, and improving our state’s business climate was a big part of that.”

The “partisan obstructionism” Berger refers to are efforts by the governor and Democratic legislators to protect two assets that draw businesses to North Carolina – good public education and natural resources. Businesses are not just coming for low taxes. They’re coming for a skilled workforce and a quality of life that is appealing to their employees.

Even the CNBC ranking points to the Republicans’ myopic view that cutting taxes and regulations make for a successful state. While ranked No. 1 overall, North Carolina is 34th in the category of life, health and inclusion. It’s possible to both support big business and the general population. For instance, CNBC ranked Minnesota No. 5 among top states for business and No. 4 in life, health and inclusion.

Alexandra Sirota, executive director of the nonprofit NC Budget & Tax Center, said, “The focus on big, out-of-state business and the accolades of national rankings has distracted some leaders from the hardships facing too many working families — unaffordable housing, lack of child care—that they could address and at the same time unlock a more sustainable economic path for the state that is based on well-being not profits alone.”

North Carolina is benefiting from an influx of federal covid relief money, historic federal investments in manufacturing and bio-science and a general migration toward the lower cost of living and the milder climate of the Southeast. But if the state keeps neglecting its public schools, its social services and its environment, that gap between its overall rating and the welfare of its people will catch up with it.

This story was originally published July 12, 2023 at 1:36 PM with the headline "NC’s top business ranking obscures the growing needs beyond big ribbon cuttings | Opinion."