Talent v. business cost

Michigan Gov. Rick Snyder has been pushing mightily over the last two years to make the state more business friendly. His tax reforms, and his signature on the right-to-work law, have made businesses very happy, but it has been at the expense of lots of other things, especially education. Snyder's efforts mean Michigan will soon be in the top 10 states for best business climate.

Lou Glazer, cofounder and head of the nonpartisan think tank Michigan Future, says Snyder is aiming for the wrong top 10 list.

Glazer looks at private sector earnings, the average combination of wages and benefits of those working for private companies. The states with the best business climate are not the states with the best private sector earnings. High employee earnings happen where workers have four-year degrees. That's in sectors such as health, insurance, business services, law, marketing, architecture, and information.

When an employer goes shopping for a place to build its HQ their biggest question is, "What kind of talent do you have around here?" The next question is, "What are your business costs?" But it is quite rare for a state to offer great talent and low business costs.

That's because a state has to spend to create, attract, and keep talent. Those with four-year degrees are mobile. Students want a great education system (and Michigan has been underfunding it). They'll choose a great city before looking for a job (and Michigan has been letting cities rot and infrastructure crumble). Top talent wants quality of life (and the state has been slashing funding for that).

Glazer says simply increasing taxes won't work because it probably won't be spent wisely. It should be spent in two areas: investing in education and investing to revitalize cities.

Snyder has been saying there are vacancies for truck drivers. But college graduates, the ones who would really boost the economy, aren't looking to drive a truck.

So Glazer is saying something similar to Brian Dickerson of the Freep who said Snyder is doing all he can to chase our top talent away.