Rhode Island a “New Economy” Leader
Rhode Island moved up to 11th place in the 2008 State New Economy Index released today by the Ewing Marion Kauffman Foundation and the Information Technology and Innovation Foundation (ITIF)….This year’s report cited the state’s R&D tax credit of 22.5 percent – the nation’s highest – “as a key investment,” state economic development officials noted today.
Rhode Island was No. 2 for health-IT initiatives, behind only the Bay State. The report credited government leadership and “an organized effort to make the state a leader in e-prescribing.” It also was No. 2 for residential broadband.
It was No.3 for industry research spending, as a percentage of worker earnings. “Rhode Island may score so well [on industry investment in R&D] because a number of defense electronics and biotechnology firms operate there, and the fact that it instituted the nation’s most generous R&D tax credit several years ago,” the Kauffman / ITIF report said. State economic development officials also cited the 22.5-percent credit, calling it a “key investment.” It was No. 4 for non-industry investment in R&D; the report credited the presence of large federal facilities – mainly, Naval Station Newport.
The state also ranked No. 4 for both its digital economy, based in part on government use of IT, and local industry investment in R&D; and No. 5 for its population of scientists and engineers, as a percentage of the total work force, in part because of the presence of the federal laboratories at the Naval Undersea Warfare Center (NUWC) Division Newport. In the agriculture and IT ranking, the state tied for No. 5 with Connecticut, Maine, Massachusetts and Vermont.
The Ocean State was honored as the nation’s “Top Mover” for its increase in inventor patents. And it was ranked among the top five movers in the fastest-growing firms category – a ranking by the percentage of local companies on the Deloitte Technology Fast 500 and Inc. 500 lists – where it moved up 10 points from last year to No. 32.
Rhode Island was 23rd in initial public offerings (IPOs); 19th in “gazelle jobs” at companies with fast revenue growth (7.8 percent); and 17th in foreign direct investment (3.1 percent).
There were some negative moves in rankings, but overall the trend is “up.” However, these rankings have to be viewed regionally, and the Northeast is extremely strong as whole. To make an analogy, Rhode Island is like the Tampa Bay Rays to the Yankees and Red Sox of New York and Massachusetts, for instance. Still, good news.