Nebraska among Forbes' Top Ten Best States for Business

08.31.06 - Lincoln, Nebraska

No. 7 has proven very lucky for Nebraska. That’s where the state ranks among Forbes magazine’s recently released first-ever “Best States for Business” list.

“There is little doubt that Nebraska needs to continue working to improve its business climate and overall tax structure for Nebraska families,” said Governor Dave Heineman. “However, the ranking from Forbes offers a snapshot of the progress we’re making and a clear window into the future of growth and economic opportunity for our state.”

“We’re excited about this announcement, and this clearly indicates that our efforts are working. Our strong leadership is working hard to improve Nebraska’s economic climate and put Nebraska on the map,“ said Richard Baier, director of the Nebraska Department of Economic Development.

Forbes has ranked the Best Metro Areas for Business and Careers for the past eight years, but this is the first time they’ve ranked Best States for Business. Forbes incorporated some scoring factors from the Best Metros’ list, while expanding factors that related more specifically to states as a whole compared with cities.

Forbes went a step further with the states ranking in several ways. First, they looked at projections in regards to job, income and gross state product growth. They also examined venture capital money going into an area as well as new businesses that have cropped up the past five years. Another addition is the role that government played on the business climate in terms of environmental and labor laws, as well as tax and other incentives offered. These factors play out on the state level rather than the local level.

The magazine examined all 50 states according to 30 metrics in the categories of business costs, labor, regulatory environment, economic climate, growth prospects, and quality of life. Nebraska scored in the Top 10—nine’s in both business costs (cost of labor, energy and taxes) and quality of life (schools, health, crime, cost of living, and poverty rates). The state’s regulatory environment (regulatory and tort climate) earned a respectable 14.

The state’s economic climate (jobs, income, and gross state product growth, as well as unemployment and the presence of big companies), labor (educational attainment, net migration, and projected population growth), and growth prospects (projected job, income, and gross state product growth, opening and closing businesses, and venture capital investments) scored a little lower, however, these are some areas for growth and improvement.

Nebraska fares very well regionally. Other Great Plains and Midwest states that earned slots among the top 25 were: Colorado—5th, North Dakota—13th, South Dakota—17th, Kansas—21st, Wyoming—23rd, and Iowa—25th.

Forbes also ranked Omaha and Lincoln relatively high in its list of the best metro areas. In the May 4, 2006 Forbes article on Best Metropolitan Areas for Business and Careers, Omaha was ranked 34th and Lincoln 40th among the best 200 metro areas. On one of the component measures for those ranks, the cost of doing business, Lincoln was ranked 22nd and Omaha 33rd.