Our economic recovery, and those who would hinder it.

As reported today by the Everett Herald, our state’s economic recovery will be less hare and more tortoise. What solace we can take however, is that Washington is better off than other states.

The analysis was completed by the state Employment Security Department, in their 2009 Labor Market and Economic Report.

While ESD predicts a better 2010 than 2009, the report outlines a couple of obstructions to our recovery, and one curious one. From the Herald:

State revenue is dependent on sales tax, meaning budgets will still be cut to the bone going forward. Infrastructure problems such as traffic congestion could hamper growth, and the report authors speculate that Washington’s reputed “negative business climate” could make it difficult for the state to attract new companies and retain old ones.

The first two conditions are legitimate and quantifiable. The third, however, left us scratching our heads a bit, and wondering which part of the dog is leading and which is following.

It’s well documented Washington has one of the highest business-friendly rankings of any state, as many publications have reported, from U.S. News and World Report to Forbes. We’ve pointed out why a few times here, here, and here.

Forbes Magazine ranks us the second best state to do business, up from third the year before. U.S. News and World Report says if you’re looking to start business, Washington is number one. According to the Tax Foundation, the non-partisan tax research organization, Washington ranked ninth, up from 14th the year before in their annual report on the business-friendliness of state tax systems. And the nonpartisan public policy think tank, The Kauffman Foundation, ranks our business climate us Number Two. Quoting from their report, the 2008 State New Economy Index:

“Washington state ranked fourth in 2007 and 2002, and has moved to second place. Washington scores high due to its strength in software (in no small part due to Microsoft) and aviation (Boeing), but also because of the entrepreneurial hotbed of activity that has developed in the Puget Sound region and very strong use of digital technologies by all sectors.”

Just take it from Don Brunell, the President of the Association of Washington Business, who released a statement on September 24, 2009:

“It is key to Washington’s economic recovery to have our state’s business advantages nationally recognized. When you step back and look at Washington in relation to the rest of the country, we are doing well. Neighboring states like Oregon and California are struggling right now, raising fees and taxes to balance their budgets."

Brunell went on to say: “Washington state is a great place to do business, and we must do everything we can to protect — and enhance—that competitive advantage.”

We believe we should always remain vigilant, and strive always to improve the business climate in our state, helping business flourish and working families achieve economic security. We invite the constructive policy ideas that have helped our state’s industries succeed and make our state a hotbed of innovation.

But, as the ESD report points out, despite numerous business-minded periodicals and business leaders pronouncing Washington a national leader in business-friendliness and economic recovery, it appears our economy will suffer from naysayers willing our economy into slowdown with words of discouragement.