Building upon North Carolina’s competitive advantages
Despite the claims that North Carolina needs to cut taxes and shift the tax load on to middle-class and low-income taxpayers to remain competitive, such an approach will actually undermine the competitiveness that our state has achieved. If we look across a range of metrics on outcomes for North Carolinians, businesses and the economy, North Carolina is indeed competitive.
Tax rates are not the sole factor that drives the state’s economy nor does it make or break the reputation of North Carolina as a desired place to raise a family and operate a business. Below are four examples, among many, that highlight areas in which North Carolina has made positive progress.
- Median Household Income: Median household income for North Carolina is in the middle of the pack – higher than South Carolina and Tennessee and lower than Georgia and Virginia.
- K-12 Education: North Carolina ranks ahead of all but one bordering state, Virginia, in 4th and 8th grade student performance in math and reading, according to data from the National Center for Education Statistics.
- Cost of Higher Education: Average tuition and mandatory fees at public 4-year colleges and universities in North Carolina is the lowest among all bordering states. North Carolina has long valued higher education and an affordable post-secondary education is attractive to families as well as employers.
- R & D Expenditure: North Carolina ranks ahead of all bordering states in research and development expenditure per capita. The majority of R & D funding comes from federal grants (largely via our institutions of higher education), research institutions, and private industry.
- Entrepreneurship and Economy: North Carolina outperforms all bordering states in the number of U.S. patents per capita. A survey by the pro-business U.S. Chamber of Commerce ranks only one bordering state ahead of North Carolina for business birthrate (Georgia) and gross state product growth (Virginia).
These highlighted examples are just a sample of what it should truly mean to be competitive: having an educated workforce, encouraging entrepreneurship and innovation and improving the economic security of everyday North Carolinians. Through targeting investments in education, research and development, and business supports, North Carolina has achieved these outcomes and outpaced our neighboring southern states. Our position as a leader among southern states is commendable but we shouldn’t stop here. There is more to be done to ensure that all North Carolinians enjoy the benefits of the state’s economy. To be competitive, we should aim to build upon our strengths and invest to improve our outcomes.
Just as successful businesses identify, develop and leverage their respective competitive advantages, North Carolina should follow this approach. Rejecting the current tax plans – which would undermine the state’s ability to support further improvements in education, research and entrepreneurship – in favor of a comprehensive approach to fiscal policy is needed now more than ever.