One sign the national recovery may finally be taking hold is what is happening in states hit hard by the Great Recession. Take Georgia, for example. Unemployment is still above the national average, coming in at 7.2 percent in May. But the state is adding jobs faster than most of the country, helping Georgia to rank first in a new study of the best states in the U.S. for business.
The 8th annual America’s Top States for Business study by CNBC awards Georgia 1,659 points out of a possible 2,500, outpacing second place Texas by 15 points. Rounding out the top five are Utah, Nebraska and North Carolina. The study ranks the states based on publicly available data in ten different categories.
Even in tough times, Georgia is typically competitive thanks to its large, mostly non-union workforce and its well developed infrastructure including the world’s busiest airport in Atlanta and one of the nation’s busiest ports in Savannah. But the recession knocked the state on its heels to say the least, because it literally hit the people of Georgia where they lived.
Housing is one the largest components of the state’s economy, and during the boom, the state overbuilt badly. Then the financial crisis hit and Georgia lost more than 300,000 jobs.
At the worst of it, the state led the nation in foreclosures—one in every 300 homes.
As late as 2011, unemployment was above ten percent.
“Businesses closed, buildings became vacant, and the newspapers that served as the legal organs of their counties were filled with foreclosure notices as families lost their homes,” Republican Gov. Nathan Deal recalled in this year’s State of the State address in January.
Georgia’s comeback has largely tracked the national rebound. The housing market has worked through the worst of its imbalances, and job growth resumed. Georgia’s economy grew 1.8 percent in 2013 according to the Commerce Department—the exact same rate as the country as a whole.
But that has not stopped Gov. Deal, who is running for re-election in 2014, from claiming some of the credit.
“My basic focus has been on creating private-sector jobs for Georgians. With your help and the involvement of our business community, we have done some great things,” Deal said in his State of the State address, citing measures like tax cuts for manufacturers, and cutting the state workforce by more than 16 percent since he took office in 2011.
The CNBC study ranks Georgia near the middle—20th—for cost of doing business, but notes the state has one of the nation’s lowest tax burdens on businesses. The state ranks first for workforce, and ties with Texas for the nation’s best infrastructure. But the big difference for Georgia in 2014 was its economy, surging to third place in the category after adding more than 50,000 jobs in the past year.
The state still has not recovered all of the jobs it lost in the recession, a point seized upon by Gov. Deal’s general election opponent, Democratic State Sen. Jason Carter.
Carter, the grandson of former President Jimmy Carter, says the recovery in Georgia has been uneven.
“If you’re a big business, if you’re a political deal maker or you are one of the governor’s friends, chances are things are going well for you in Georgia. But if you’re a small business or regular middle-class family, chances are, you’re feeling forgotten,” Carter said in his State of the State response in January.
Carter has been especially critical of Deal’s record on education.
The state’s schools—from kindergarten through college—have been chronically underfunded, and test scores lag the rest of the country. In the CNBC study, education is one of the few areas where Georgia performed poorly, ranking 32nd.
Earlier this year, the legislature approved Deal’s request for a $547 million budget increase for K-12 schools, which Carter has derided as an election year ploy after years of underfunding.
The CNBC crown is the second major honor for Georgia’s business climate in less than a year. Last November, Site Selection magazine ranked the state first in its annual rankings.
For the entire list click here: 2014 America’s Top States for Business rankings