Revitalizing Massachusetts: How a Declining Business Environment Impacts Everyone

There’s so much to love about Massachusetts. The beaches, the mountains, our rich culture and history…the list goes on and on. But if we don’t get our business climate back on track, all of these things won’t be enough to keep current residents around or draw in new ones. And that’s bad news for everyone in the Commonwealth. 

This year, Massachusetts fell to 38th place in CNBC’s annual ranking of the best states to do business in. That is a dramatic drop from 15th place Mass. was awarded in 2023. 

So, where are we going wrong and why does it matter?

The unfortunate truth is that Massachusetts has become a difficult place for businesses of all sizes to thrive. In fact, for the last nine months of available data, there were more business deaths than new births in the Commonwealth.

When business suffers, so does the overall economy. Whether you’re a teenager or recent college grad looking to get your foot in the door, or someone further along in their career ready for the next step, a lack of opportunity means everyone stagnates. 

Unfortunately, job growth in Massachusetts last year ranked 36th in the country according to the Bureau of Labor Statistics.

Now, take this lack of opportunity and add in some of the highest taxes of any state in the U.S. From income tax, estate tax, alcohol taxes and even car taxes, most residents find these costs frustrating. It’s not just about paying taxes – it’s about feeling there’s little accountability for how those tax dollars are spent. 

Meanwhile, the cost of living is also on the rise – and that includes housing prices. Whether you own or rent, the cost of keeping a roof over your head is also going up. Massachusetts housing prices are higher than 45 other U.S. states. One recent analysis found that the only state with a higher cost of living than Massachusetts was Hawaii. 

It’s no wonder that when people compare their prospects here to what they could have in another state, Mass. increasingly just cannot compete. 

People are leaving Mass. in droves to states where many believe they have a better chance to prosper. Recent data from the Pioneer Institute shows Massachusetts has some of the highest out-migration numbers in the country, and taxable wealth losses have quadrupled in the last decade. It’s no coincidence many choose states like Florida or New Hampshire where there is no income tax or estate tax. 

Losing residents, especially wealthier ones, means the rest of us have to pick up the tab on these high taxes. But it’s not just about money – keeping people in our state means we keep their creativity and talent here as well.

Our state excels at providing top notch education and fostering innovation (check out our Opportunity Report Card for more details). But without more manageable costs and a welcoming environment for businesses of all sizes, it’s not enough. 

But we can change that. The first step is recognizing where we’re going wrong and changing course.