Albany Times Union: Upstate New York business sentiment hits 15-year low, survey finds
March 5th, 2024
Business leaders overwhelmingly believe that New York’s government works against them, according to Siena College Research Institute
Read the article by Rick Karlin here.
COLONIE — Opinions about the upstate New York business climate are at the lowest point since 2008, according to a poll released Tuesday by the Siena College Research Institute.
In all, 67 percent of upstate New York CEOs say business conditions are getting worse. Twenty-nine percent say they are staying the same while 4 percent believe conditions are getting better, according to the 17th annual Upstate New York Business Leader Survey from Siena College Research Institute.
Surveyors spoke with 585 business leaders from across upstate including the Capital Region, Central/Mohawk Valley New York, the Finger Lakes, the Mid-Hudson and western New York.
Only 18 percent of the CEOs expect the economy to improve in 2024 while 55 percent see worsening conditions in the next year.
And as in past years, business leaders said they view state government as an impediment to doing business, due to the raft of regulations, red tape, mandates and taxes.
Eighty-one percent said they believe state government is a detriment to doing business in New York. Only 11 percent think the government of New York is doing either an excellent or good job of creating a business climate in which companies like theirs can succeed.
“Large majorities say that state government, crime, housing affordability and local permitting processes are detriments,” observed Siena College Research Institute Director Don Levy. “And more CEOs say our energy systems, health care system, workforce, local government and even our culture is more of a detriment than an asset.”
In a new development, many also said they believe the state’s push to transition to carbon-free sources of energy will hurt them.
Fifty-six percent, for instance, said they believe the move to eliminate gas- and oil-fueled heating and cooking appliances from new construction in favor of alternatives such as electric heat, will be harmful to the economy.
Criticism of state government and mandates is nothing new among the business class. But it may resound a bit louder than usual this year in the Capital Region, which has been slammed by the loss of manufacturers that have decided to consolidate or move operations to other states.
Quad printing in Saratoga Springs, Lehigh Cement and Essity Paper in the Glens Falls area, AngioDynamics in Latham, and VinylMax in Clifton Park are among those that have left or announced plans to do so as they consolidate operations in other locations.
They aren’t necessarily moving to Asia, Mexico or other low-wage countries or even the southern states. Some are consolidating in Massachusetts, Ohio and Wisconsin as well as places like Georgia.
Just outside the Capital Region, Remington Arms, which has been in Ilion, Herkimer County, since the early 19th century is closing its firearms factory in favor of a new facility in Georgia. And The College of St. Rose in Albany, unable to compete in the higher education market, has announced its plans to close.
Large mega-employers such as chipmakers Micron Technology and GlobalFoundries have announced plans to expand in Syracuse and Malta, but those are highly dependent on government grants and will employ highly specialized people. And the development of offshore wind has created jobs at companies like GE/Vernova and tech startups.
But lesser-known old-line companies like Remington or Essity, making rifles and tissue paper, have continued to struggle, even though those companies often provide good-paying, blue-collar jobs.
“The results of this survey show the concern employers express to us every day that harmful policies are adversely impacting their business’ ability to grow and prosper. Our business sectors are seeing high taxes, strict mandates and little cooperation from lawmakers, forcing them and their employees out of New York state,” said Heather Mulligan, president and CEO of the Business Council of New York State, which co-sponsored the survey.
The comparisons with other states can be stark. And it’s not just state government that can be an obstacle — localities with their thicket of requirements and required studies, can be roadblocks as well.
Ann MacAffer, a well-known commercial real estate agent with CBRE, said that she recently dealt with a company looking to expand into New York as well as Ohio.
The paperwork to get started on a new project in Ohio took about a day compared to more than six months in New York.
“When I tell her it takes six to eight months to get through the planning process she looks at me, like ‘Are you kidding?’” MacAffer said of the response from the corporate official.
Others say that New York regulations can also be unpredictable and ever-changing.
The latest twist in unpredictability comes with the enactment of the 2019 Climate Leadership and Community Protection Act, which sets out a goal for decarbonization to cut greenhouse gas emissions that are exacerbating climate change.
That calls for getting 70 percent of the state’s electricity from alternative sources such as wind and solar by 2030.
Manufacturers, warehouse operators and other businesses that require lots of heat, air conditioning and electricity are particularly worried about what the state’s “Cap and Invest” program will look like, said Justin Wilcox, executive director of Upstate United, which advocates on behalf of upstate businesses.
Under a Cap and Invest program, which is being developed by state officials, large users of fossil fuels — ranging from manufacturers to schools to hospitals, trucking companies and other enterprises — will have to purchase allowances or credits for the greenhouse gases they emit.
Proceeds from these allowances, which are like a carbon tax, will help fund energy efficiency and green energy projects.
If users become more efficient and move away from fossil fuels, they can sell these carbon credit allowances. Even though the credits can be sold, business leaders still see this as increasing their costs. Some companies may have to invest in new energy-saving equipment or use costlier forms of energy.
“That’s the backdrop,” Wilcox said. “You pile on every year additional uncertainty, additional regulations, it’s sort of the death by a thousand cuts.”
The poll was sponsored by The Business Council of New York State, UHY Advisors financial consultants and the Hudson Valley Economic Development Corp. It was conducted Oct. 10, 2023-Jan. 24, 2024 by mail and internet interviews.
To read the entire survey, go here or to https://scri.siena.edu/2024/03/05/siena-college-17th-annual-upstate-new-york-business-leader-survey/.