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SALT LAKE CITY — I spent some of the early years of my professional career as a television sportscaster. I worked in Topeka, Kan. and Tulsa, Okla., both places where they love their college football and—much more so than here in Utah—they like NASCAR.
Now, I grew up here along the Wasatch Front and even after five years watching sports for a living, I still think it looks like a bunch of cars driving around in a circle. It is; but many assure me that it is a great deal more complex than that.
The one thing I do know about NASCAR is that as they drive bumper-to-bumper at 185 miles per hour, there are a few critical moments in every race when a well-positioned driver can make a split-second decision to move ahead in the field. Do that enough and you win the race.
Smart businesses spend a great deal of time circling the track with the rest of the pack, running making small gains on the competition. By putting themselves in the right position, they can take advantage of opportunities in the key moment when they appear.
Smart businesses do it all the time, too. They spend a great deal of time circling the track with the rest of the pack, running making small gains on the competition. By putting themselves in the right position, they can take advantage of opportunities in the key moment when they appear.
I mention this because our state—far from the epicenter of stock car racing fandom—has greatly benefitted from this same principle.
Smart management of state affairs before the Great Recession positioned us to not only weather the storm, but to gain market share on our competition. Other states operating too closely to the edge were forced to make significant cuts to spending and many chose to raise taxes.
In Utah, our balanced budget, our Rainy Day Fund of over $400 million and our strategic investment in infrastructure projects like I-15 CORE, TRAX and FrontRunner allowed us to leapfrog the competition when the economy turned sour.
Today, Utah has an unemployment rate of 5.1 percent, well below the national rate of 7.1 percent. We have regained the total number of jobs lost during the recession and revised data shows our economy has been growing at over three percent, meaning we're back to our historical (i.e. pre-recession) average. That growth rate is better than double the national rate, by the way.
The other cars in the race—the states we compete with to attract business—had to swerve and slow down (with many ending up in a 10-car crash) while we put the pedal to the metal and shot right past.
Our performance has been impressive enough to be named the "Best State for Business" for the third consecutive year. This award is what Gov. Gary Herbert often refers to as the "national championship."
Utah just three-peated.
Just this past week, Alan Hall wrote an insightful piece for Forbes looking at Utah's secret to success. He cites three reasons we are such an attractive destination for businesses looking to flee states with declining workforces and rising taxes.
- Low (and I would add stable) tax rates
- Young, well educated workforce
- Healthy regulatory environment
In three simple steps we have created a safe harbor for businesses. When looking for a place where they can invest and grow, a business knows Utah provides the essential elements.
Jeff Edwards, the president and CEO of the Economic Development Corporation of Utah, often says businesses like Utah because they know what their tax rates are today and they essentially know what they are going to be in ten years. Businesses like to plan and that requires a level of predictability. Give them a flat five percent corporate tax rate and a track record showing they can count on it for the foreseeable future and suddenly you are a very attractive place to do business.
No matter what kind of business you are in, human capital—talented people—is essential to success. Utah's large family sizes mean we have plenty of young people and we do a good job of educating them. Throw in an unusually high number of bilingual workers and we become even more enticing to growing organizations.
When it comes to regulation, businesses want a level playing field. What they don't want is a series of nonsensical hoops to jump through. While the federal government continues to find ways to add costly regulation to business, here in Utah the governor modified or eliminated 368 regulations that were of no benefit to anyone.
As the country slogs forward with some states still stuck in the pileup caused by the recession and others struggling to make it to pit row, Utah is pulling away from the pack and headed to claim the checkered flag.