Edward M. Mazze | Distinguished university professor of business administration, University of Rhode Island
1. Business rankings have measured different elements of the Rhode Island economy. What is the most-relevant data? To understand whether Rhode Island is on the right economic path, data on population, employment, housing, income, real gross state product, new-business starts and bankruptcies have to be included as part of the rankings.
2. What is the most relevant business-environment survey out there for us? Do they all have flaws? The national rankings do not reflect what is happening in Rhode Island. Before selecting and using a ranking, you need to determine if the ranking has any unintentional or intentional bias and is being reported to drive an agenda. You need to determine: When the data was collected and for what purpose. What methodologies and procedures were used. Does the ranking accurately reflect the data collected? Do the conclusions agree with local data that is available? Many of the rankings are not rigorous in how they collect and interpret data and are therefore of little value in making decisions.
3. We know politicians pay attention to them and use them. How much do business executives consider this data when relocating a business? Rankings are considered as one factor by relocation firms and others in making recommendations about selecting a state or region for a business. Rankings are used most often to identify “red flags.”
4. What recent survey do you think characterized Rhode Island correctly and what did it find? All of the surveys contain useful information. However, the rankings by Forbes, U.S. News and World Report, the Business Insider, USA Today, CNBC, the Tax Foundation, Chief Executive Magazine, Site Selection Magazine and others do not include information on many of the key factors affecting the Rhode Island economy, such as cost of government, financial support for education, the tax structure, unfunded public pension and health-benefit liabilities, the cost of attracting and doing business, and infrastructure issues.
5. What data should not be considered relevant for local businesses because of the small physical and population size of the state? A dashboard to measure [the state’s] economic progress should include information about population changes, total employment and by industry sector, unemployment, underemployment, cost of housing, housing permits, real gross state product, real total personal income, disposable income, payroll growth and level of education.
Scott Blake is a PBN staff writer. Email him at
Blake@PBN.com.
