Policy Documents

Keeping Massachusetts Competitive: The Business Climate in Context

Steve Poftac –
September 16, 2011


Massachusetts is a state with many economic and competitive strengths, but policymakers, elected officials, and business leaders must not ignore its weaknesses. Massachusetts offers compelling advantages to companies looking to expand businesses or start new ones, but other states are chipping away at the state’s advantages in this area. Of equal concern is the fact that the state’s shortcomings--notably, the cost of doing business and an unfavorable and unpredictable tax environment--create a disadvantage when compared to many of the Commonwealth’s national and international economic competitors.

States that compete with Massachusetts to attract and retain businesses are working to make their tax environments more supportive of sustainable job and revenue growth, drive down business costs, improve their quality of life, and build highly skilled workforces. In response, Massachusetts must compete for jobs across all dimensions. By this, we do not suggest that the state should embark on a quixotic, ideology-driven quest to be the lowest cost location for businesses. Rather, the state’s policymakers must carefully examine how public policy affects business costs and ensure that Massachusetts is competing in all possible areas. To be effective, Massachusetts policymakers must avoid splashy, high profile efforts to attract marquee firms or sectors and focus instead on improving the foundation for our entire tech-based innovation economy to better position Massachusetts as a place where innovators want to work, entrepreneurs want to start companies, and employers want to grow their businesses.