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Study: States Should Grow Their Own High-Tech Jobs, Shun the Tax-Break 'War Among States'
January 13, 2010Pennsylvania and six other states vying with one another to grow their high-tech economies will best succeed by focusing on their existing employers and shunning the "economic war among the states" involving costly tax-break competitions. That's the finding of a major study released today by Good Jobs First. Ohio, New Jersey, New York, Maryland, North Carolina and West Virginia are the states compared. As states experience their most severe revenue crisis in post-war history, the study charts a positive alternative strategy for the most effective job-creation investments. The study draws its conclusion from two unique analyses of Pennsylvania. One details where the state's high-tech jobs have come from since 1990; the other reveals the effective tax rate for high-tech companies in all seven states. It finds only minimal differences among tax rates -- even when the states' most lucrative economic development incentives are accounted for. "Over time, all the growth in Pennsylvania high-tech jobs comes when existing workplaces expand and new ones are born -- not from smokestack-chasing," said Greg LeRoy, executive director of Good Jobs First and primary author. "We believe the same analysis would find similar results for the six other states." Full release.