The Fortune magazine article two weeks ago naming Salt Lake City as the No. 1 city in the United States to do business was characterized Friday as superficial and comparable to Weekly Reader material.
The article based its conclusions on some items that many businessmen don't care about when deciding whether to relocate or expand their company, said Joel Kotkin, author and a recognized authority on international trade and regular contributor to the Los Angeles Times and Washington Post.He told members of the Pioneer Partnership in the Alta Club that when businessmen decide to move their business they often don't think about the items mentioned in the Fortune article such as availability of plentiful, high-quality and low-cost labor and its educated work force.
Kotkin said the article seemed to castigate California because of its cosmopolitan population and large influx of immigrants, but immigrants are actually improving the economic climate of the area because they are good workers and bring an influx of foreign capital into an area.
He said the article talked about Utah workers' loyalty to their employees and in some cases that's bad. It's healthy for an economy for people to leave and start their own companies and hire people because small business is where most of the jobs are created today.
A Los Angeles resident, Kotkin said if the California economy dies, as hinted by the magazine article, the Utah economy will suffer also because they are tied together. "I doubt if Utah could live off California's carcass," he said.
As an example of California's continuing economic importance, Kotkin said the Sony Corp. is spending large amounts of research and development money in Los Angeles and San Francisco. "Sony needs the wierdos in Silicon Valley and wasn't concerned about savings by locating elsewhere," he said.
Several years ago, Kotkin said, the Osmond family thought film producers wanted to escape the problems of California so they built a studio in Orem. "Well, you have seen what happened to it," he said.
Kotkin said even though California has its problems, motor vehicle records show the state still has people moving in and many are coming from Utah, an indication that things aren't as bad as many people picture.
Utah needs to incorporate its economy into the economies of the Pacific Rim countries, Kotkin said, because the best investment opportunities will come from that part of the world rather than from Europe. He said there is no entrepreneurship in Europe.
He said two-thirds of the people on the Earth live in the Pacific Rim and that is where the majority of economic explosions are occurring. By the mid-1990s, the economies of the non-Japanese countries in the Pacific Rim will exceed those in Europe, Kotkin said.
Rather than Utah becoming a state where many subsidiary companies are located, it should strive to become an entrepreneurship state. He suggested working with California companies and banks because many of them are owned by the Japanese and Chinese.
One of Utah's biggest assets is The Church of Jesus Christ of Latter-day Saints and its missionary program because many missionaries are bi-lingual and understand the people and culture in other countries. Other assets are the large number of entrepreneurs starting their own companies, he said.