Milken Institute Cost of Business Study

From the Milken Institute:

Hawaii, New York and Massachusetts are the most expensive states in the nation in which to do business, according to the 2005 Milken Institute Cost-of-Doing-Business Index.

Hawaii, which was also number one on last year’s index, has business costs that are 43 percent higher than the national average. Second-place New York’s costs are 30 percent higher, and third-place Massachusetts has costs that are 25 percent greater than the U.S. overall. California is fourth and Connecticut is fifth, with costs that are 24 percent and 22 percent higher, respectively.

The states with the lowest costs of doing business are South Dakota, 50th, with costs 28 percent below the national average; North Dakota, 49th (23 percent lower); Iowa, 48th (19 percent); Montana, 47th (19 percent); and Idaho, 46th (16 percent).

The Cost-of-Doing-Business Index, released annually by the Milken Institute, indicates each state’s comparative advantages or disadvantages in attracting and retaining businesses. The Index measures wage costs, taxes, electricity costs and real estate costs for industrial and office space. Each state is measured on the five individual categories, and those weighted scores are compiled to make the overall index.

More here.

Katrina: Could Cost Us 400,000 Jobs

The devastation left by Hurricane Katrina could cost the U.S. economy an initial loss of 400,000 jobs in September and reduce monthly average job creation by 30,000 jobs for the rest of 2005. It could also increase the price of oil by $10 a barrel and lead to a nearly one percent decline in GDP growth in the fourth quarter of this year.

But next year, reconstruction efforts will turn things around – adding back those 30,000 jobs per month, easing the price of oil and increasing the GDP by more than a percentage point during the second and third quarters.

These are the preliminary findings of two Milken Institute regional economists who’ve studied the potential impact of Katrina on the U.S. and Gulf Coast economies. Their insights are based on extensive research and knowledge of the economic impacts of natural disasters and terrorist attacks, such as 9/11.

More here.

Target Medical Device and Equipment Companies

Here are some of the key companies DTIA thinks are worthy of contact in the medical device and equipment industry.

(Note: We have an extensive database that allows us to profile any or all of these companies. Contact use about pricing. Tel: 440-449-0753. Email: dtia@don-iannone.com

Acuson Corporation
Advanced Medical Optics, Inc.
Affymetrix, Inc.
Allergan Corporation
Alpharma Corporation
Apogent Technologies
Arrow International, Inc.
Arthrocare Corporation
Bausch & Lomb Corporation
Beckman Coulter Corporation
Becton Dickinson Corporation
Bio Rad Labratories, Inc.
Boston Scientic Corporation
C.R. Bard & Company
Cardinal Health, Inc.
CONMED, Inc.
Cryolife, Inc.
Curative Healthcare, Inc.
Cyberonics, Inc.
Datascope Corporation
Dentsply International, Inc.
DP
Edwards Life Sciences Corporation
Guidant Corporation
Haemonetics Corporation
Henry Schein, Inc.
Hologic, Inc.
Hospira, Inc.
Inamed Corp.
Integra Life Science Holdings Corporation
Invacare Corporation
Medtronic Corporation
Mentor Corporation
Newport Corporation
Patterson Dental Company
ResMed Inc.
Respironics, Inc.
Sola International, Inc.
St Jude Medical, Inc.
Steris Corporation
Stryker Corporation
Sybron Dental Specialties
Teleflex, In
The Cooper Companies, Inc.
Viasys Healthcare, Inc.
VISX Inc.
West Pharmaceutical Services, Inc.
Wilson Greatback Technologies, Inc.
Zimmer Holdings, Inc.

Growing in Line with Nature's Rules

I will keep this very simple today.

As I ponder the aftermath of Hurricane Katrina and try to imagine the possible destruction that may be brought on by Hurricane Rita, one thought comes to mind. As economic developers, we have a lot to do with where and how people and businessses grow and develop.

Human beings are NOT above Nature, although much of the time we mistakingly think we are. We must live within Mother Nature's rules if we are to survive. We must do what we can to maintain harmony and balance in our world. Nature's way is the only way.

From Dallas: Shifting Business Landscapes

Here is one that makes you look twice at what is happening to our nationss business landscape. It's a case in point from Dallas, Texas.

The Dallas Morning News’ D-FW Top 200 list provides an overview of the landscape of local public companies.

An analysis of the companies’ collective data also provides a reading of the Dallas-Fort Worth area's business performance. For instance, 2004 fiscal revenue of the 200 companies grew 14.7 percent over 2003, while net income grew 34.6 percent. Investors liked those results, too. The Bloomberg D-FW Top 200 stock index, a price-weighted index of the companies on last year’s list, gained 31.7 percent last year.

For the first time, a list member has less than $1 million in revenue. No. 200 Access Pharmaceuticals Inc. had 2004 sales of $549,000.

The newspaper expanded the list from 100 to 200 companies in 1996. In 1997, the smallest company on the list had $25.2 million in revenue. That figure has declined every year.

This year’s roster also featured the smallest turnover since the list was launched in 1985. Only 19 companies dropped off this year, compared with 25 in 2004 and a peak of 39 in 1997.

Both trends seem to suggest a certain level of stagnation, at least at the low end of the spectrum.

But the figures actually mirror a national trend — a shrinking universe of publicly traded companies.

Wilshire Associates — keepers of the Wilshire 5000 index, which attempts to track every U.S.-based public company — is one of the few organizations that analyzes the smallest of the small-caps.

The Wilshire 5000’s membership has dwindled from a peak of about 8,000 stocks a few years ago to fewer than 5,000 today. (That puts the lie to the index’s name, a fate that could befall the D-FW Top 200 next year.)

For both indices, the number of companies with at least $30 million in revenue has been falling over the years, while the number with at least $1 billion has surged.

The figures point to a consolidation, as big companies acquire smaller ones. Put another way, more companies are being acquired, going under or going private than going public or growing into multimillion-dollar concerns.

Certainly the universe of privately held companies is strong. The News ’ list of private companies has expanded to 100 this year, and revenue across the board increased over last year.

Read more here in the Dallas Morning News. (Free registration required)

Federated Department Stores to Cut 6,200 Jobs

The retail sector has its problems. Consolidation and growing competition from the big boxes continues to take its toll. Here is the latest.

Federated Department Stores Inc. said on Tuesday it is planning to cut up to 6,200 jobs beginning next year and change all 62 Marshall Field's stores to the Macy's name in the fall of 2006 in its biggest steps yet since completing its acquisition of May Department Stores Inc.

The operator of Bloomingdale's also said it will shed the Philadelphia-based bridal group division it acquired from May and is studying what to do with its Lord & Taylor division.

About 4,500 positions will be eliminated beginning in March as Federated phases out May's divisional operations in Boston, Houston, Arlington, Va., and Los Angeles. The remaining 1,700 cuts will be in St. Louis at May's corporate offices.

Read more here.

Approaching Economic Development Systematically

Have you ever said to yourself that you should be approaching economic development more systematically? I know I have. Many times across my 30 plus years in the business.

Actually, there is a way to systematize your thinking and approaches to economic development. As a starting point, it helps if we turn to the field of systematics dynamics.

Here are a few ideas to start you off. I suggest that you visit the Systems Thinker website for more information, if this is an area that appeals to you. I did, and it helped me.

What is Systems Thinking?

Systems thinking offers you a powerful new perspective, a specialized language, and a set of tools that you can use to address the most stubborn problems in your everyday life and work. Systems thinking is a way of understanding reality that emphasizes the relationships among a system's parts, rather than the parts themselves. Based on a field of study known as system dynamics, systems thinking has a practical value that rests on a solid theoretical foundation.

Why Is Systems Thinking Important?

Why is systems thinking valuable? Because it can help you design smart, enduring solutions to problems. In its simplest sense, systems thinking gives you a more accurate picture of reality, so that you can work with a system's natural forces in order to achieve the results you desire. It also encourages you to think about problems and solutions with an eye toward the long view—for example, how might a particular solution you're considering play out over the long run? And what unintended consequences might it have? Finally, systems thinking is founded on some basic, universal principles that you will begin to detect in all arenas of life once you learn to recognize them.

What Are Systems?

What exactly is a system? A system is a group of interacting, interrelated, and interdependent components that form a complex and unified whole. Systems are everywhere—for example, the R&D department in your organization, the circulatory system in your body, the predator/prey relationships in nature, the ignition system in your car, and so on. Ecological systems and human social systems are living systems; human-made systems such as cars and washing machines are nonliving systems. Most systems thinkers focus their attention on living systems, especially human social systems. However, many systems thinkers are also interested in how human social systems affect the larger ecological systems in our planet.

Alabama's Defense Sector Growing

According to Business Facilities Magazine, two major defense companies, EADS, the parent company of European aircraft maker Airbus; and Northrop Grumman, a global defense company, recently decided to expand operations in Alabama.

One question at this point in time is: Will the effects of Katrina influence these plans? For Alabama's sake, let's hope the plans go through.

Read more here.

Mall of America Expands

Mall of America developers announced detailed plans for a $1-billion expansion of the mall at a Minneapolis commercial real estate conference.

Providing an additional 5.6 million square feet, the "Phase II" expansion includes a 6,000-seat performing arts center, three hotels, condominiums, a museum, an ice rink, and a stream running through the main corridor.

Formal expansion plans have not been presented to Bloomington, MN, city officials, who will need to approve any expansion.

Read more here.

Agricultural Crop Genetic Engineering

My work in industry-based economic development strategy is carrying me in many new industry directions. Here is one of interest to areas with big agriculture and agribusiness bases.

The advent of genetic engineering in the agriculture industry has heralded an era of positive growth in the crop protection sector.

As the industry becomes increasingly conscious of the benefits of genetic engineering, political considerations, and influences are expected to drive growth. With the government organizations of various countries entering into political agreements regarding genetic engineering and biotechnology, the global technical scenario is likely to emerge stronger. Further, as the production capacity in many regions, especially within the East European countries continues to expand, the potential worldwide production capacity is likely to increase.

Non-Food Sectors More Conducive for Genetic Engineering Technology Applications

Food crops are not the only area where genetic engineering is likely to prove beneficial. In fact, with most consumers tending to be a trifle wary of genetically-modified food products, investors are likely to find the non-food sectors such as industrial feedstock or biofuels much more lucrative. "Genetically engineered (GE) plants are produced by splicing foreign genetic material within the plant genomes and creating new species which can not arise naturally," notes the analyst. "There are high chances of recombination and mutation of these genes, which could cause biological pollution."

As the industry continues to contend with the lack of public awareness regarding the contribution of genetic engineering to food production, it is essential to retain the trust of the public by monitoring all the steps of the production and marketing chain. This is likely to improve the performance of the food sector as well.

Genetic Engineering Techniques Proves More Efficient than Traditional Techniques

In comparison to the conventional crop protection technologies, genetic engineering has several advantages. While traditional protection techniques are efficient, they are incapable of ensuring that the final product has all the desired characteristics. For instance, it has been observed that the introduction of certain genes produces species that are more tolerant to herbicides such as paraquat than the conventional and traditional varieties. The enzymes produced by these modified species also improve the plant’s immunity to certain other commonly employed herbicides such as acifluoren.

"Genetic engineering techniques and biotechnology has resulted in increased research and development, rapid innovation, and prolonged perseverance in the face of mounting research costs on an industry level," notes the analyst. "These factors have created conditions that are conducive for the further development of genetic engineering in the area of crop protection."

IRS Corporate Filing Data

Looking for some good financial information on corporations filing returns with the IRS. Click on the links below to download Excel spreadsheet data with an industry breakdown. Useful data.

Tax Years: 2001 2000 1999 1998 1997 1996 1995 1994

Real Earnings Decline

Real average weekly earnings fell by 0.5 percent from July to August after seasonal adjustment, according to preliminary data released recently by the Bureau of Labor Statistics of the U.S. Department of Labor.

A 0.1 percent increase in average hourly earnings was more than offset by a 0.6 percent increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Average weekly hours were unchanged.

Read more here.

Software Publishing Jobs

Industry Profile

All organizations today rely on computer and information technology to conduct business and operate more efficiently. Computer software is needed to operate and protect computer systems and networks. Some 8,200 establishments are engaged primarily in computer software publishing or publishing and reproduction. Software publishing establishments carry out operations necessary for producing and distributing computer software, such as designing, providing documentation, assisting in installation, and providing support services to software purchasers. These establishments may design, develop, and publish, or publish only.

Establishments providing access to software for clients from a central host site, designing custom software to meet the needs of specific users, or involved in mass duplication of software are classified elsewhere.

Software publishing establishments that design and publish prepackaged software may develop operating system software as well as word processing and spreadsheet packages, games and graphics packages, data storage software, and Internet-related software tools such as search engines and Web browsers—the software that permits browsing, retrieval, and viewing of content from the Internet. Some establishments may install the software package on a user’s system and provide customer support.

Software is often divided into two main categories—applications software and systems software. Applications software includes individual programs for computer users—such as programs for word processing or for developing and maintaining spreadsheets and databases. Systems software, on the other hand, includes the operating system and all of the related programs that enable the computer to function. The Internet has vastly altered the complexion of the software industry over the last decade. Much applications and system software is developed for use on the Internet and for connections to the Internet.

Economic Development Issues

* Employment is projected to increase 68 percent between 2002 and 2012, ranking software publishers as the fastest growing industry in the economy.

* Computer specialists account for half of all workers in this industry.

*Job opportunities will be excellent for most workers; professional workers enjoy the best prospects, reflecting continuing demand for higher level skills needed to keep up with changes in technology.

Jobs in Arts, Entertainment, and Recreation

Industry Overview

As leisure time and personal incomes have grown across the Nation, so has the arts, entertainment, and recreation industry. This industry includes more than 108,000 establishments, ranging from art museums to fitness centers.

Practically any activity that occupies a person’s leisure time, excluding the viewing of motion pictures and videotape rentals, is part of the arts, entertainment, and recreation industry. The diverse range of activities offered by this industry can be categorized into three broad groups—live performances or events; historical, cultural, or educational exhibits; and recreation or leisure-time facilities.

Key Economic Development Issues:

* More than 40 percent of all workers have no formal education beyond high school.

* Employment growth, along with substantial replacement needs, should create numerous job opportunities.

* Earnings are relatively low, reflecting the large number of part-time and seasonal jobs.

American Indian Tribes

Click on image to enlarge.
Source: Censusscope

States With At Least 1% American Indian Population

1. Alaska, 15.47%
2. New Mexico, 9.47%
3. South Dakota, 8.18%
4. Oklahoma, 7.73%
5. Montana, 6.12%
6. Arizona, 4.94%
7. North Dakota, 4.88%
8. Wyoming, 2.30%
9. Washington, 1.55%
10. Idaho, 1.35%
11. Nevada, 1.33%
12. Utah, 1.28%
13. Oregon, 1.27%
14. North Carolina, 1.25%
15. Minnesota, 1.11%
16. Colorado, 1.00%

Source: 2000 U.S. Census

Rising Role of Corporate Boards: What Could It Mean for Business Location?

A recent study conducted by Mercer Delta Consulting, in conjunction with The Center for Effective Organizations at the University of Southern California’s Marshall School of Business, reveals that Boards are exerting more influence in the Boardroom and have greater independence from management. The study found that:

- 93% of directors surveyed felt their Board was independent of
management “to a great” or “very great” extent
- 95% said that Board members voice opinions that conflict with the CEO’s view
- 73% said CEOs have less control over their Boards “to some” or
to a “great or very great” extent
- 92% of directors indicated that they had influence over the meeting agenda

Despite this shift, directors were positive overall regarding the dynamics in the Boardroom and their ability to work effectively with management:

- 92% said that the Board works well with senior management
- 95% reported Boards receive sufficient information to carry out their responsibilities
- 96% indicated that the CEO keeps the Board informed about
significant matters affecting the company

My question is this: "Given this trend, will boards exert greater influence on where their companies locate business facilities in the future?"

Place Branding: Some Starting Definitions

People seem a bit confused about "branding," which is a subject of growing interest in economic development. The starting place is defining "branding" and its various aspects. Maybe this will help.

Brand Equity: The power of a brand — through successful creation of a positive image — to shift demand and change customer behavior.

Brand Identity: The visible elements that can be used to identify a brand (name, logotype, symbol, product configuration, service offering and packaging).

Brand Image: The complete bundle of thoughts a customer has in his or her mind about a company, product or service developed through communications and experience, including the distinguishing "human" characteristics of a brand personality (e.g., warm and friendly, strong and reliable).

Brand Promise: A statement of the enduring, relevant and distinctive benefits customers associate with a product, service or company.

Brand Strategy: Long-term plan for the brand including a determination of key audiences and an understanding of what those audiences need to know about the brand and experience.