By the Blouin News Business staff

CEO survey reveals best and worse U.S. states

by in U.S..

(Source: NASA Goddard Space Flight Center/flickr)

(Source: NASA Goddard Space Flight Center/flickr)

Chief Executive magazine on Monday released a survey of 513 CEOs ranking American states on their business environment. CEO perceptions on states’ tax and regulatory regimes, workforce qualities, and living environments this year have largely held true to the pattern established in the 11 previous surveys. The top four were Texas, Florida, North Carolina, and Tennessee, while the bottom four were New Jersey, Illinois, New York, and in dead last, California.

The survey’s takeaway messages were clear: CEOs favor states with fewer regulatory obstacles and report that most remedies dangled by politicians only make things worse. Tough compliance requirements are souring some CEOs on the financial incentives for creating jobs.

Additionally, more CEOs indicated that workforce quality, particularly technical talent, is becoming a top priority. However, a perceived hostile attitude from a state towards business would outweigh that. Case in point: despite California’s first-rate university system, the state consistently finishes last in the CEO surveys. Silicon Valley is the exception rather than the norm in California.

Also, nearly all the states in the top 10 ranking are right-to-work states (meaning employees can choose whether or not to join or financially support a union), while all of the bottom 10 are not.

To improve their rankings, states should cut unnecessary red tape, which hampers businesses – especially small ones with limited resources — and curbs job creation. This is a major reason that small-company creation in the U.S. is running at its lowest level since the 1970s.

Last February Blouin News covered the outstanding incentives that Nevada offered in order for Tesla Motors to select the state for the site of the $5 billion Gigafactory. But to its credit, almost all of the incentives for Tesla are performance-based, meaning “while Nevada shares in the upside, Tesla alone shoulders the downside.” Rather than being antagonistic towards businesses, Nevada is hoping for them to succeed. It’s no surprise then, that the state ranked #9 this year in the CEO survey.