A Closer Look at Maryland’s Business Climate

In July 2018, CNBC released its list of America’s Top States for Business 2018. Overall, Maryland was ranked 31st out of all 50 states, an aggregate score that combined many metrics that CNBC considered as contributing to a state’s “business climate.” (Texas topped the list, and Alaska came in at the bottom.)

Each state was ranked in “10 broad categories, weighted based on how frequently each is used as a selling point in state economic development marketing materials,” CNBC said. “That way, [the] study ranks the states based on the criteria they use to sell themselves.” The final ranking, therefore, may not tell the complete story of a state, which may not fare too well in one category while excelling in another. That’s certainly the case in Maryland.

CNBC’s takeaway for Maryland, which fell six spots in the ranking since last year, was that “the workforce in the Old Line State is excellent. But it is expensive to live here.”

And CNBC’s numbers do bear that out. Maryland came in 6th in the country in CNBC’s Workforce ranking, an A grade (up from 11th in 2017). The state also came in 10th in Technology & Innovation, earning an A-minus (a score which dropped from 4th in 2017). Maryland also racked up a solid B in Access to Capital, coming in 16th (15th in 2017).

Maryland was also in the top half of all states in Education (20th) and Economy (21st), and landed very close to the middle in Quality of Life (26th).

However, CNBC also had to factor in cost of living, and the state earned an F in that category, coming in 44th in the country. And many experts agree that the state does have a high cost of living. “There isn’t a county in Maryland with an average list price under $100,000,” notes the SmartAsset website, which explains that the least expensive homes are in Allegany County, with an average listing price of $103,360. Listings in Talbot County, the priciest county, average at around $650,000. Rents and utility costs are also slightly above average.

None of that keeps business experts from being excited about Maryland. Another list in 2018 saw Baltimore move up 39 spots to 20th in a ranking of cities and states for business friendliness. Thumbtack.com rated Baltimore a B, Baltimore Business Journal reported. Meanwhile, Maryland rose 13 spots to 20th and earned an overall B-plus.

Maryland ranked higher than its neighbors, the Baltimore Business Journal noted—Virginia was 25th, Delaware was 27th, and Pennsylvania was 36th.

Thumbtack.com ranked Maryland 5th overall for its training and networking programs. Baltimore’s training and networking programs earned it 3rd place overall.

And yet another survey released in 2018 had even more good news: the Maryland Business Climate Survey “shows that senior executives at 250 businesses are feeling pretty good about the state’s economy—so much so that they’re planning to hire more people in the next year,” reports the Baltimore Business Journal.

“The survey finds that Maryland’s economy is well positioned to grow in the future provided that employers can find the right candidates for jobs,” said Richard Clinch, an economist and author of the survey by the University of Baltimore Jacob France Institute and the nonpartisan Maryland Public Policy Institute.

“Solving the workforce shortage and minimizing the negative impact of tax policy on businesses will be critical to Maryland’s economic strength moving forward,” Clinch told the Baltimore Business Journal.

Any business owner has to weigh a detailed set of variables that are far too complex to be summed up in a single number. When picking a headquarters, she has to determine how a state’s priorities align with the needs of the business, and how a state’s government and infrastructure can help her succeed in the specific areas that are most valuable to her. A qualified Maryland business law attorney can help you determine how best to take advantage of Maryland’s business climate. Contact Lusk Law, LLC, for more information.

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