We’re proud to be a Utah-based engineering firm. We’ve called his great state our home for more than 30 years. And although the COVID-19 pandemic was a challenge for everyone, we were fortunate to count on our clients here in Utah and beyond to help carry us through. Now, we are thriving. But we aren’t the only ones. Sure, there’s a lot of construction going on. Developers are more in need of engineering services than ever before. And there’s a good reason for that. Simply put, Utah has a great environment for business. Let’s take a closer look at why.
Why does Utah have such a pro-business climate?
Let’s look at all of the individual reasons why engineering firms, construction companies, retail businesses and other companies thrive in Utah’s climate. First, Utah has a very high rate of upward mobility for workers within its economy when compared to other states. What does that mean in practice? Well, “upward mobility” refers to the chances of a person being raised in the bottom fifth income bracket and reaching the top fifth income bracket. There are a lot of people in Utah who have bootstrapped themselves to success, and it’s because Utah provides them with that opportunity.
Utah has also established itself as a tech hub. Our “Silicon Slopes” is home to some of the biggest tech companies in the world. Northern Utah has facilities where some big names in tech conduct research and create products and services. They include big names like Adobe, EA Sports, and the Intel/Micron joint venture IM Flash Technologies. Many students who have graduated from prestigious Utah universities have found internships or built careers at companies that have a presence in the Silicon Slopes.
Utah also has a favorable regulatory and tax climate. The Beehive State offers a flat five percent personal and corporate tax rate, one of the lowest in the nation. Small businesses benefit from low-tax environments. And while low taxes are important to small businesses, a stable tax rate is equally important. Utah small businesses have benefited from the predictability of the state’s flat tax, which was first introduced two decades ago.
Utah remains a desirable state
Utah has been increasingly recognized as one of the top places in the country for business. As recent research suggests, Utah’s pro-business climate is enhanced by the state’s strong and stable economy. Utah has one of the biggest worker shortages in the Union. Utahns don’t have to go far to see the effects of the labor shortage — from hiring signs in restaurants and gas stations to businesses still running on reduced hours. Many of our favorite businesses are still shuttered or working at half-staff.
Utah sits at the epicenter of growth in the Intermountain West. Businesses flock to Utah and the state’s economy functions as a growth engine in the region. Utah continues to have one of the strongest economies in the country. Currently, Utah is tied for the second lowest unemployment rate in the country, at 2.1%, according to new data from the U.S. Bureau of Labor Statistics. Employers continue to struggle to keep employees on and not only replace those who leave, but grow their workforce.
OThisis a problem that also has benefits. But of course, there are also challenges. All this unbridled growth has created a need for workers that the state hasn’t been able to keep up with. As a result, companies must push up wages to attract workers and raise prices on their products and services. The low unemployment rate could be inflationary. And yet, people from all over the country continue to move to Utah to find opportunities.
Businesses incentives drive growth
One of the biggest factors driving business growth in Utah remains the incentives businesses have to move their operations to the state. Incentivizing business creation and sustainable growth is key to Utah’s thriving small business ecosystem. There are now several state-funded programs across the state that businesses can tap into to expand and retain clients. Rural parts of the state can also access grant programs for small businesses.
Utah offers financial incentives for business relocation and expansion. These incentive programs are built with three factors in mind. State leaders want to ensure they are both effective and sustainable. First, the business expansion must be competitive. Second, the incentives must be post-performance. And thirdly, the incentive must be a tax rebate once the jobs have been created and the corporate taxes are paid. Most importantly, these incentives were previously only available to new companies relocating to Utah. But not anymore. Today, they are available to businesses already in Utah to help them grow right here on home soil.
At McNeil Engineering, we’re proud to be part of the stability underpinning Utah’s business community. We’ve worked with many businesses in the state. We’ve even worked on some projects in the Silicon Slopes. And we’re so happy to be doing business in a state that makes it easy for us to do so.