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“The Power to Tax Is the Power to Destroy ” — John Marshall
 Source: www.pnnl.gov
State Business Taxes — The Ultimate Resource (Maybe)
Most states have passed tax breaks, some large, some modest, for companies that move there or expand their presence. Because there are so many possible permutations of taxes and breaks, comparing states can be tricky and time consuming. Knowing this, the Tax Foundation undertook to provide what may be the definitive resource for businesses and site selectors who need to make state-to-state comparisons entitled the “2008 Business Climate Index.” While it’s published as a resource for individuals and businesses, it also draws some sobering conclusions on the overall state of U.S. national competitiveness. The report says, “American companies often function at a competitive disadvantage in the global economy. They pay one of the highest corporate tax rates of any of the industrialized countries. The top federal rate on corporate income is 35 percent, and states with punitive tax systems cause companies to be even less competitive globally. The modern market is characterized by mobile capital and labor. Therefore, companies will locate where they have the greatest competitive advantage.” Further, the report ranks the states by business climate. The top three are Wyoming, South Dakota and Nevada.
For more great insight on state taxes and business climates, read the state business climate rankings feature and the annual legislative update in the Nov. 2007 edition of Site Selection magazine.
New Study — Taxes Discourage Investment and Entrepreneurship
Most economists and development professionals already accept that higher corporate taxes discourage corporate investment and drive it elsewhere. A recently released National Bureau of Economic Research (NBER) study confirms the tax-investment inverse relationship and adds the brand new finding that higher taxes also discourage entrepreneurship — the creation of small businesses. The study report, called “The Effect of Corporate Taxes on Investment and Entrepreneurship,” says, “we present new cross-country evidence on the effects of corporate taxes on investment and entrepreneurship using a sample of 85 countries.” The report concludes, “Our data reveal a consistent and large adverse effect of corporate taxation on both investment and entrepreneurship. A 10 percentage point increase in the effective corporate tax rate reduces the investment to GDP ratio by about 2 percentage points (mean is 21%), and the official entry rate by 1.3 percentage points (mean is 8 %).”
 Source: National Bureau of Economic Research (NBER)
“The happiest business in all the world is that of making friends, and no investment on the street pays larger dividends. For life is more than stocks and bonds.” — Anne S. Eaton
 Source: Texas Government Insider
Texas Releases List of Capital-Project Bond Election Results
The State of Texas recently held elections which included referendums on bond issues to fund dozens of infrastructure and improvement projects. On this, the Texas Government Insider writes, “Texas voters created a wide assortment of opportunities for contractors Tuesday by overwhelmingly approving more than $15 billion in bond expenditures for capital improvement projects to address growth issues in the state, cities, counties, school districts and community colleges. For the most part, the bond issues for new schools, roadways, jails, courthouses, police stations, new parks, technology upgrades and long-term expansion programs passed with comfortable margins.” The Insider has published a complete list of the approved bond issues.
IAMC Economic developer members from Texas include Fort Worth Chamber of Commerce, Greater New Braunfels Chamber of Commerce, Greater Dallas Chamber of Commerce, Wichita Falls Board of Commerce & Industry, Greater Waco Chamber of Commerce, Austin Chamber of Commerce, Bay Area Houston Economic Partnership, Amarillo Economic Development Corp., Development Corp. of Snyder, Inc., Denton Economic Development and Sulphur Springs / Hopkins County EDC.
“O gold! I still prefer thee unto paper which makes bank credit like a bank of vapor”
— Lord Byron Credit Managers’ Index Points Down
With aftershocks from the subprime mortgage crisis continuing, the Credit Managers’ Index fell for the third straight month in November, for which five of the index’s six unfavorable credit factors fell below 50, indicating a contraction is possible. A press release quotes economist Daniel North as saying “cracks are starting to show and the Fed will almost certainly cut the Fed Funds rate again at its December 11th meeting in an effort to forestall a recession.” “The manufacturing sector fell 0.3% in November to a seasonally adjusted 52.7. Five of the 10 components fell, with bankruptcies plummeting 7.9%, the second largest drop on record,” says the release.
 Source: National Association for Credit Management
 Source: Federal Reserve and Grubb & Ellis
Subprime Issues Spill into Commercial Real Estate
Grubb & Ellis’ December 3 “Weekly Market Insight” sees increasing signs credit market stress is depressing commercial real estate activity. The report says, ”Credit markets deteriorated again in November after showing signs of recovering in October.” “Investors piled into risk-free Treasury bills, driving prices higher and interest rates lower, while shunning asset-backed commercial paper, some of which is backed by risky subprime residential mortgages,” reports Grubb & Ellis. “Weekly Market Insight” concludes that credit market issues are “beginning to impact commercial real estate leasing activity, property values and sales volumes.”
“It’s Not Easy Being Green” — Kermit the Frog
 Idea 3: Use the most energy efficient locomotive, GE’s Evolution.
Source: www.theautochannel.com
50 Ideas to Make Your
Making business “greener” is definitely a hot topic for the business news. How aggressively companies are investing in making themselves more environmentally friendly is not yet fully understood. But if you’d like ideas for greening your company, read the article “50 Ways to Green your Business” by Mark Borden, Jeff Chu, Charles Fishman, Michael A. Prospero and Danielle Sacks. They say, “Here are our favorite ways companies today are greening up—and saving money and making better widgets in the process.”
Company “Greener” Shared Services; Global Location; FM Salaries; Brain Drain
Companies Use Shared Services to Lower Costs and Raise Quality
The corporate shared services concept has been used for years, but not always successfully. The concept moves staff-like functions from dispersed departments to a single location where they compete for the company’s business against outside service providers. Corporate real estate is part of shared services functions at some companies. The white paper “Shared Services,” published by SAP, is a primer on the topic, providing the rationale, benefits and steps for establishing a shared services center (SSC). The publication says, “The concentration of homogenous tasks in an SSC brings economies of scale and a significant decrease of costs, which is the number one reason for the creation of SSCs.” “The second most frequently mentioned reason is quality improvement. The concentration of employees at one location also concentrates expertise. Continuously repeated processes are more often improved and streamlined, reducing errors and saving time,” contends the primer.
 Source: IBM, ”Global Location Trends, October 2007“
Vietnam Rising Fast as Location for Manufacturing Jobs
Most who read the business pages know that India and then China are the locations of choice for new manufacturing jobs in recent years. But according to “Global Location Trends, October 2007,” just published by IBM, Vietnam is the up-and-comer placing just after China at the list’s number-three spot. IBM’s press release on the report says its “ annual study of countries receiving investment from multinational companies in the area of manufacturing, services and R&D reveals that the U.S., which increased its share of inward investment projects from 7 percent in 2005 to 11 percent in 2006, was the top ranking destination country for inward investment projects.” “India and China continue to lead in the total number of new manufacturing jobs created through inbound corporate location investments, however Vietnam has risen at a rapid clip,“ it says. In its conclusions, the report contends, ”The emerging importance of corporate social responsibility (including labor practices, environmental policy, energy consumption, and supply chain management) is a new decision criteria and imperative for investors, multinationals and communities alike.“
 Source: www.pnnl.gov
Facility Managers’ Salaries Up, Average Age too
“Profiles 2007,” a report on the demographics of corporate facility managers who are members of the International Facility Management Association (IFMA) finds that 14 percent work in the manufacturing sector. Regarding compensation, the report says, “In 2007, 90 percent of facility management salaries ranged from $43,000 to $144,000. The median salary is $80,000, with the top 10 percent earning $125,000 or more and the bottom 10 percent earning a base salary of $50,000 or less. The average salary is $84,945 with total compensation averaging $91,776. Most respondents (59 percent) are eligible to receive a bonus in their current compensation package. The median bonus is $6,000, with the top 25 percent receiving a bonus of $14,000 or more and the bottom 25 percent receiving a bonus of $2,000 or less.” The FM workforce is aging. On this, a summary of the report says, “The average age of respondents is 48 years, with 17 percent under the age of 40 years and 24 percent age 55 years or older. One fourth (24 percent) of respondents are female.”
Immigration Law Prevents Many Foreign Graduates
As if there are not already enough ironies about U.S. immigration law, a Wall Street Journal article entitled “American Brain Drain” notes that many foreign students acquiring advanced degrees in engineering and the sciences at top American universities don’t qualify to work in the United States. Clearly, U.S. industry could use this talent. The article says, “...more than half of all foreign nationals who earned advanced degrees in math and science in 2007 have been shut out of the U.S. job market.“ “Current policies have MIT and Stanford educating the next generation of innovators — and then deporting them to create wealth elsewhere,” it quips. The Journal concludes, “Closing the door to foreign professionals puts U.S. companies at a competitive disadvantage and pushes jobs out of the country.”
of U.S. Universities from Working Here  Source: www.theperfectworld.us
-- Joel Parker
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