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States’ ability to thrive in new economy measured
While traditional economic development within the states has shifted to an economy more reliant on innovation, many policy discussions remain mired in acknowledging just some of the more recognized tech-based regions, says the Information Technology and Innovation Foundation (ITIF) in its latest report. However, as economic indicators reveal that all states’ economies incorporate some degree of innovation as a driver of their economy, the 2017 State New Economy Index measures states’ capacities to function in this new economy.
The index builds on seven prior editions and uses 25 indicators across five different categories to measure how well each state is positioned to succeed in an economy driven by technological innovation. The economic categories are:
- Knowledge jobs
- Globalization
- Economic dynamism
- The digital economy
- Innovation capacity
The top 10 states, each with a score above 75 are: Massachusetts (96.6), California (84.7), Washington (84.5), Virginia (81.7), Delaware (80.4), Maryland (78.9), Colorado (78.3), New Jersey (7.6 percent), Utah (77.3), and Connecticut (76.4). Each past State New Economy Index has used slightly different indicators and methodologies, so the report state that total scores are not directly comparable year-to-year and movement in rank between editions may not positively reflect actual changes in its economic structure.
The report also examines the role of large and small businesses in driving growth and discusses some innovative models around the nation to spur workforce training and technology commercialization. It delves into state policy choices in two areas — taxes, investment and economic development; and small business — where the authors, Robert D. Atkinson and J. John Wu, assert that states need “clearer thinking, or at least analysis” when formulating policy.