Where can I find the best educated, or the most reliable, work force? Where can I find the most inexpensive workers? How about high-tech, entrepreneurial scientists and engineers?

Where can my workers experience the highest quality of life at the lowest cost to my business? Where can I provide my work force high quality health care at the lowest possible cost to my bottom line? Which communities offer the best public schools that will train my work force 10 years from now?

Where can I find the most business-friendly tax and regulatory climate? How about the best logistics infrastructure for my company? Where can I find the best combination of air, rail, water and highway access to ship my products, or to bring in the raw materials my business needs?

These are all critical questions that business leaders face whenever they are considering where to locate a new facility. Whether that facility will be a distribution center, or manufacturing facility, call center or back office operation, or even a corporate or regional headquarters, all of these factors will be important to one degree or another.

That’s why, every year, Expansion Management’s renowned research department compares communities according to a variety of characteristics important to corporate site selectors.

Summary of the Major Studies

During the course of the year, we examine 329 metropolitan statistical areas (MSAs) from a variety of perspectives. The two most recent MSAs — Auburn-Opelika, Ala., and Corvallis, Ore. — were not included in any of the quotients. Missoula, Mont., was not included in the Logistics Quotient™.

Like most of our readers, our studies also have a tendency to emphasize labor and operating costs. To that end, here are the six major studies we’ve conducted during the past 12 months:

Education QuotientTM — The EQ evaluated 1,500 school districts (about 20 percent of all high school degree-granting districts) nationwide as a way to provide our readers with a basis for comparing the type of work force they are likely to encounter in various communities throughout the United States. The EQ focuses on results, not on spending, with the main emphasis placed on how much students learned (college board test results) and whether they finished what they started (graduation rates).

Health QuotientTM — The HQ looks at healthcare as being a major cost for employers throughout the nation. It is also something that varies from community to community in terms of cost and availability. This year’s HQ compared the MSAs according to a variety of categories that measured both the availability of quality healthcare services and the cost to employers of those services. In this ranking, cost is just as important as quality, and vice versa.

Quality of Life QuotientTM — The Quality of Life Quotient™ looks at quality of life as being access to the American Dream at a price affordable to most people. While nice, access to the theater, opera and cutting-edge poetry readings are not what most Americans consider important to the daily lives. What is important is the ability to afford to own a decent (read: average) home, or to afford to rent a decent three- or four-bedroom apartment, to live in a community that is relatively free of violent crime and property crime, to be able to send their children to good public schools, to be able to afford to save money to send their kids to college, to be able to keep the lion’s share of their income (rather than giving it to the government in the form of taxes), and the ability to improve one’s skills through a quality community college or university. That is what most American workers want. The Quality of Life Quotient™ compares the MSAs based upon their ability to provide that access to the American Dream at the lowest cost to the employer.

Logistics QuotientTM — The LQ is an attempt to compare the logistics infrastructure and work force among the MSAs. This study compares the logistics work force and logistics companies within each of the MSAs, as well as the transportation infrastructure (road, air, rail and water) servicing that metro. The study also looks at taxes and fees imposed on logistics activities in those cities. Since most logistics decisions are driven by the need to locate in a particular geographic region, corporate site selectors can use the results of this study to evaluate how cities did on a national, as well as a regional, basis.

High-Value Labor Market QuotientTM — The HVLM attempts to identify where companies in the know-based industries are most likely to find the workers they need, both in terms of quality and quantity. It compares the MSAs according to such criteria as the percentage of scientists and engineers in the overall work force, the number of patents issued per capita, the number of colleges and universities (and community colleges) in the metro area, and the research and development spending per capita. The idea is to identify where companies are most likely to find that critical mass of highly educated, technical worker so essential to the New Economy.

Legislative QuotientTM — The Legislative Quotient™ attempts to compare the business climate created by the 50 state legislatures in terms of the areas over which they actually have control: taxes and government spending. While all politicians love to take credit for a good economy (but are nowhere to be found when it comes to accepting responsibility for a bad economy), it is in the type (e.g., corporate income tax, sales taxes, franchise taxes, excise taxes, inventory taxes, etc.) and degree (e.g., the tax rate) of taxes levied on local businesses that they have their greatest impact on the local economy. Right behind that in terms of importance to business is how these legislatures choose to spend the money they raise, specifically in the areas of education and infrastructure.

The Overall Winners

When it comes to smart, reliable workers and low business operating costs, the Midwest is clearly an excellent place to look.

This year’s Top 10 finishers in the Mayor’s CupTM, headed by Des Moines, Kansas City, Omaha and Minneapolis, are all Midwestern cities. In fact, only three of this year’s Top 10 — Seattle (No. 5), Lexington, Ky., (No. 7) and Columbia, S.C. (No. 9) — are not located in America’s Farm Belt.

Although the Midwest as a region still dominates, the results are a lot more spread out when it comes to the metros that finished in the Top 10 percent.

In all, 18 states (21 when you consider multi-state MSAs) and the District of Columbia are represented among the top 33 finishers (there are 331 MSAs overall in the study).

Topping the list of top 10 finishers is Iowa, with five, followed by Minnesota and Texas, each with three. Alabama, Kansas, Kentucky, Nebraska, North Dakota and Pennsylvania each had two.

Interpreting the Results

Each of the six research studies was given equal weight, with the winners doing the best, on average, in all six.

However, it’s possible that not all six are important. In fact, there are lots of companies, particularly those in the knowledge economy, for which salary costs and quality of life at a reasonable price at not issues. For them, it may be access to the high value labor market that is most important.

For others, particularly those looking to establish distribution facilities, perhaps it’s our Logistics Quotient TM and Education Quotient TM that have the greatest importance.

For most of our readers, particular those with labor-intensive operations, the Expansion Management approach to evaluating costs is critical to their maintenance of a healthy bottom line. It is for them that we offer the results of our first annual Mayor’s Challenge™.

Bill King is chief editor of Expansion Management magazine. He can be reached at BillKing@penton.com. Michael Keating is research editor for Expansion Management magazine. He can be reached at mkeating@penton.com.