Mass. Near Top in Economic Competitiveness (Boston Herald)

By Jay Fitzgerald  |   Monday, October 25, 2010  | 

Massachusetts has been knocked off the top perch of a national survey that ranks the economic competitiveness of states.

The Bay State ranked first in the past two “State Competitiveness” reports by Suffolk University’s Beacon Hill Institute. But this year Massachusetts fell to third, behind North Dakota and Colorado.

The state’s budget deficits and air quality, of all things, lowered its overall score for this year’s rankings, said Jonathan Haughton, a Suffolk economics professor and one of the principle authors of the report being released today.

While Massachusetts lost its place at the top of the competitive heap this year, Haughton said “there are 47 other states that would love to be in the position that Massachusetts occupies on our index.”

The institute’s report looks at 43 “indicators” to arrive at its conclusions. But some of the main categories are government and fiscal policy, infrastructure, human resources, technology, business incubation and even environmental policies.

Like other states, Massachusetts has grappled with budget deficits, hurting its score this year.

But bad air quality? Haughton said, yes, air quality last year, from which all stats were compiled, wasn’t very good in Massachusetts, as measured by the government.

Chris Anderson, president of the Massachusetts High Technology Council, said he hasn’t reviewed the institute’s study. But he said a lot of chief executives he knows view Massachusetts as a tough place to do business, due to higher taxes and general expenses.

Anderson noted a recent survey by his group found that 56 percent of high-tech executives didn’t view Massachusetts positively as a place where they might expand.

Haughton conceded that many business executives are frustrated with taxes and other issues in Massachusetts. But the state still attracts top scientists and other skilled workers here due to a number of other factors, he said.

“It partly explains why Massachusetts was hit less hard by the recession and is recovering a little faster,” he said.

In the report, Wyoming and Minnesota rounded off the top five competitive states. Dead last in the rankings was the state of Mississippi.