Site Selection Factors You Might Not Have Considered

December 12, 2016 by Midlothian Economic Development

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When Texas holds the ranking for best business climate year after year, what does that really mean? What site selection factors play into the successful environment Texas businesses continue to enjoy?

According to Community Builders, a state’s ranking shouldn’t just focus on the economic development policy, but also the state’s perception of the general business community. Luckily, Texas tops both. This ranking comes from our exceptional executive survey ranking, the number of new significant businesses opened, and the new business openings per one million of population.  

While these factors define a successful and business-friendly climate, here are a few more key site selection factors you should consider when analyzing city and state landscapes.

Skilled Labor

A 30-year comparison chart shows that a desire for a skilled labor force has been increasing over the years. Skilled labor made its way to the number one factor in 2015, while over two decades ago, the focus was primarily on labor costs. With this steady rise, site selectors are focusing their location efforts on areas with access to a skilled workforce above anything else.  

On the Area Development’s 30th Annual Corporate Survey, 56 percent of respondents expressed a strong importance on the availability of skilled labor and their effects on expansion plans. Of those, 37 percent indicated that workers lack basic skills (e.g., reading comprehension, mathematical competency, etc.), 63 percent lack advanced skills (e.g., advanced welding, machine tool programming, bioprocessing, etc.), and 50 percent believe STEM skills are lacking in today’s workforce.

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Finding a landscape that leads in these areas is top of mind for site selectors. When looking for a skilled labor pool to pull from, consider the access to millennial workers that have been training and learning the latest technology through skills development programs. According to Area Development, it’s crucial to develop loyalty among the millennial workforce. Millennials will pledge their devotion to a company if they feel utilized and respected, and if the company practices social consciousness. Keep an eye out for companies that benefit from the Texas Workforce Commission’s Skills Development Fund (SDF) grant.

For instance, in Midlothian, Texas — a progressive city that enjoys access to strong skilled labor and millennial workforce — is embracing a partnership between Texas State Technical College and steel producer, Gerdau. The Skills Development Fund provides customized technical job training so that employees can excel in their trade. For example, students will learn to predict when a motor is going to be at the end of its lifecycle, rather than running it to failure and enduring weeks of waiting for parts. These programs instill the advanced skills needed to provide the workers of tomorrow.  

Quality of Life

As a site selector, when all the numbers align and the checkboxes are checked, does quality of life come to mind ... last? Deep down, we all know this is so important.

When evaluating a city’s quality of life, take into account the climate, housing availability and costs, healthcare facilities, ratings of public schools, cultural and recreational opportunities, colleges and universities in area, and crime rate.

Interestingly enough, in years past, theses site selection factors have never ranked as "important" or "very important" by fewer than 60 percent respondents of the Corporate Survey. However, in 2015 the looming importance has creeped its way up, making "quality of life" the third most important site selection factor. Likely due to a cultural shift in generations and a more diverse service base, the millennial workers demand work-life-balance, and we’re seeing their plea heard.

Once site selectors decide on a state, the real search begins. For instance, after closing in on Texas, we’ve seen quality of life surface as an important indicator in the city chosen for business relocation. Many flock to Midlothian, Texas, to get the whole package — infrastructure, workforce, light regulations, and of course a memorable quality of life.

Tom Pearson, Executive Vice President at Colliers International, representing the Midlothian Business Park and a few other properties in RailPort Business Park, mentioned the draw to Midlothian:

“High-quality of living. Excellent school systems and education opportunities. Good people. And, they’re positioning themselves for the future.”

Regional Regulations & Incentives

According to CBRE’s Economic Incentives – The Intersection of Site Selection and Economic Development, aggressive states tend to have incentive programs that produce the most financially significant and varied savings. Texas, being one of these, enjoys a deep economic incentive toolbox to pull from including tax credit, job training grants, cash, and local incentives programs (free land, property tax abatements, forgivable loans), just to name a few.

Texas is one of the 19 states to offer sales/use tax exemptions or rebates that allow abatements on purchases of construction materials, equipment, and utility usage that is not limited to certain industries, like other states. In addition, Texas is also one of the 19 states that enjoys cash grants in completion of full government approvals of an economic development agreement.

Limited regulation is a site selector's dream and Texas cities cater to business needs first, and regulation second. Yes, there’s not always ways around them, but cities like Midlothian, Texas, make it a point to make the process as seamless as possible.

Are your city meetings bringing together all the appropriate people into one room? Do you stay in proper communication with a city’s economic development team without feeling nagged and/or ignored? Midlothian is a destination among a thriving economy, with a quality of living that delights employers.

Make sure you’re considering all the site selection factors, and more importantly — make something great with us!

Discover More About Midlothian & Site Selection Factors

Learn more about our one-stop shop permitting in Midlothian as it compares to cities across the nation.

A Roadmap to the Midlothian Permitting Process Download our Flowchart Infographic  

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