Ingrams August 2023

DESTINATION MISSOURI BUSINESS CULTURE

FOLLOW THE METRICS, AND YOU’LL UNDERSTAND MISSOURI’S SPECIAL APPEAL AS A PLACE TO CONDUCT BUSINESS. BY SOME MEASURES, NOTHING COMES CLOSE. Business Climate and Economic Conditions

One would have to be a certified, pocket-protector-wearing nerd to know offhand the name of Frank Hachman. But we can’t think of a better friend to site-selection consultants than this former University of Utah economist. Nearly 30 years ago, he developed what’s known as the Hachman Index, which draws on metrics such as gross domestic product and employment to measure the mix of industries present in a particular region of the country. As of its last update, the state sitting atop the index as having the nation’s most diverse business ecosystem was … Missouri. And from that diversity comes economic strength. A separate tool of data crunchers, known as the Herfindahl-Hirschman In dex, also measures various concentrations in a given state using different metrics. That, too, gave Missouri Top 20 recogni tion, ranking No. 16 among states. One key driver of that scoring is the number of industries that each account for at least 5 percent of state GDP. Missouri had nine of them, led by: professional and business services, then manufacturing. While those two super sectors accounted for more than one fourth of state GDP—suggesting some

thing other than sector diversity—seven others weighed in to give the state a strong base with which to stand against economic disruption. One reason for that is the presence of two industrial hubs in Kansas City, the state’s largest city, and St. Louis, the most populated metropolitan area. If they were to be considered 1A and 1B, then Springfield has a claim to No. 2, if not 1C. The three form a metropolitan triangle through the center of a state that excels in logistics, agribusiness, aerospace and vehicle manufacturing, chemicals, trans portation equipment, printing, publish ing, and alcoholic beverages. Add all that up, and you get the na tion’s 22nd-largest state, measured by Gross Domestic Product. In Missouri’s case, that figure is $295.73 billion in infla tion-adjusted dollars. The state figure was up 4.6 percent between 2020 and 2021, while the national figure was 5.7 percent, with each figure somewhat overstated because of the depressing effects of the global pandemic year. What about the start-up prospects? The most recent state rankings by Forbes put Missouri at No. 15 for entrepreneur friendliness. Among the eight border states, only Illinois ranked higher, a status that

might be owed to the lack of a business-tax component in that magazine’s rankings. The Show-Me State prides itself in being a cradle of entrepreneurship; com panies with global reputations like H&R Block, Anheuser Busch, and Hallmark were all started here, and national brands with their roots here include Bass Pro Shops, Build-a-Bear Workshops, Edward Jones and Centene. With its tax structure, Missouri falls just outside the Tax Foundation’s Top 10, largely on the strength of a 4 percent cor porate tax rate. Combined with a top in dividual rate of 5.4 percent, the state and local tax burden came to 9.2 percent. The statewide sales tax rate is 4.225 percent, while the average across hundreds of various taxing jurisdictions sits at 4.06 percent, yielding a combined burden of 8.29 percent on taxable transactions. It also ranks low on fuel tax, at 19.92 cents a gal lon, good for 46th nationally, and is dead last in cigarette taxes, at 17 cents a pack. Property taxes? State and local per-capita levies there came to $1,114, with homeown ers, on average, paying 1.01 percent of their house’s value in local property taxes. With per-capita tax collections of just $2,447, Missouri ranked well down the list of most onerous tax structures at No. 45.

MISSOURI’S SEVEN THRIVING DISTRICTS

DISTRICT 1: NORTHWEST MISSOURI

DISTRICT 2: NORTHEAST MISSOURI

DISTRICT 3: KANSAS CITY AREA

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Counties: Andrew, Atchison, Caldwell, Carroll, Clinton, Daviess, DeKalb, Gentry, Grundy, Harrison, Holt, Livingston, Mercer, Nodaway, Worth District Population: 150,656 Biggest City (population): Maryville (10,847) Other Population Centers: Chillicothe, Cameron, Bethany, Savannah Major Employers: Kawasaki Motors, Northwest Missouri State University, Mosaic Life Care

Counties: Adair, Audrain, Chariton, Clark, Knox, Lewis, Linn, Macon, Marion, Monroe, Pike, Putnam, Ralls, Randolph, Schuyler, Scotland, Shelby, Sullivan District Population: 219,173 Biggest City (population): Kirksville (17,542) Other Population Centers: Hannibal, Moberly, Mexico, Macon Major Employers: Truman State Uni versity, KraftHeinz, A.T. Still University, Northeast Regional Medical Center

Counties: Buchanan, Cass, Clay, Jackson,Johnson, Lafayette, Pettis, Platte, Ray, Saline District Population: 1,454,199 Biggest City (population): Kansas City (508,394) Other Population Centers: Indepen dence, Lee’s Summit, St. Joseph, Blue Springs, Liberty Major Employers: Oracle Cerner, Saint Luke’s Health System, HCA Midwest Health, Ford Motor Co., Hallmark

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