1. Rankings Demystified
With Forbes’ Kurt Badenhausen &
Morgan Brennan
Moderator: Steve Duncan,
Development Counsellors International (DCI)

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Popular Rankings
Best Places for Business & Careers
Best States for Business
Best Places to Retire
Best Places to Live
Best States for Business
Best States for Business
Best Cities, States & Places

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Our Guests Today
Kurt Badenhausen
Forbes
@kbadenhausen
• Senior Editor
• 15 Years at Forbes
• Sports Business
• Author of “Best Places for
Business & Careers” & “Best
States for Business”
Morgan Brennan
Forbes
@MorganLBrennan
• Real Estate Reporter
• 4 Years at Forbes
• Fox News Contributor
• Author of “America’s
Coolest Cities” & “America’s
Fastest Growing Cities”
Moderator ‐ Steve Duncan, DCI, @sdunc33
• Account Director
• 9 Years at DCI
• Rankings & PR Specialist

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Best Places for Business & Careers
• Started 1999 in conjunction with the Milken
Institute
• Introduced new methodology in 2003
• Rank 200 largest MSAs and divisions by
population
• Methodology looks at job/income/economic
growth, costs, colleges, crime, educational
attainment, migration and culture/recreation
• Sources: Moody’s, US Census, Bert Sperling

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Best Places Methodology
• Moody’s Business and Living Cost Indexes
• 1‐year, 5‐year, 3‐year projected job growth
• 5‐year income growth
• 3‐year projected economic growth
• 5‐year net migration per capita
• Crime & culture/recreation from Sperling’s
• 4‐year college attainment
• Highly ranked 4‐year colleges in area based on
Forbes college rankings

7. Forbes Best Metro Areas for Business
Business Job Projected Proj. gross Net College
costs growth job growth metro prod. migration attainment Population
Rank Metro area rank rank rank rank rank rank (000s)
1 Provo, UT 33 30 24 14 54 28 543
2 Raleigh, NC 29 15 10 25 2 13 1,169
3 Fort Collins, CO 66 23 16 30 24 6 306
4 Des Moines, IA 37 34 46 91 43 54 581
5 Denver, CO 130 45 22 62 36 18 2,603
6 Ogden, UT 27 39 62 27 53 73 558
7 Lincoln, NE 9 28 63 52 101 39 307
8 Dallas, TX 160 18 12 5 44 43 4,357
9 Austin, TX 165 3 4 1 3 16 1,789
10 Nashville, TN 32 41 52 63 20 79 1,621
11 Omaha, NE 50 36 86 102 102 45 878
12 Oklahoma City, OK 17 24 85 72 47 109 1,279
12 San Antonio, TX 21 11 11 20 14 130 2,201
14 Durham, NC 94 31 59 48 23 11 514
15 Fort Worth-Arlington, TX 108 16 7 4 27 115 2,187
16 Seattle, WA 161 53 88 24 35 14 2,697
17 Asheville, NC 10 67 84 81 17 82 430
18 Charlotte, NC 92 40 55 26 7 52 1,800
19 Fayetteville, AR 40 59 13 158 18 133 475
20 Houston, TX 185 8 6 3 25 99 6,103
Sources: Moody's Analytics; U.S. Census.

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Top Ranked Places
• 2006: Albuquerque, Raleigh,
Houston
• 2007: Raleigh, Provo, Boise
• 2008: Raleigh, Boise, Fort Collins
• 2009: Raleigh, Fort Collins, Durham
• 2010: Des Moines, Provo, Raleigh
• 2011: Raleigh, Des Moines, Provo
• 2012: Provo, Raleigh, Fort Collins
• 2013: Will appear in 9/2 issue (8/7
online)

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Best States for Business
• Started 2006
• Rank 50 states across 35 metrics
• 6 main categories: business costs, labor supply,
regulatory environment, economic climate,
growth prospects, quality of life
• Sources: Moody’s, Census, Bert Sperling, FBI, Tax
Foundation, Mercatus Center, SBA, BEA, BLS,
United Health Foundation, Pollina Corporate Real
Estate, Dept. of Ed., PricewaterhouseCoopers

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Best States Methodology
• Business Costs: Moody’s Cost Index on labor, taxes, energy, plus Tax
Foundation index
• Labor Supply: college/HS attainment, 5‐year net migration, 5‐year
projected pop. growth
• Regulatory: Mercatus Freedom in the 50 States, Pollina tax incentive
study, right‐to‐work, Moody’s bond rating, transportation
• Economic Climate: 5‐year growth for incomes, jobs, GSP; avg. 5‐
year unemployment, current unemployment, # of big company
headquarters
• Growth Prospects: 5‐year projected growth for incomes, jobs, GSP;
VC investments; business openings and closings
• Quality of Life: Poverty & crime rates, cost of living, school test
performance, health of the populous, colleges, culture/leisure
opportunities, temperature.

12. Forbes Best States For Business
Business Labor Regulatory Economic Growth Quality Gross State Product
Overall 2011 costs supply environment climate prospects of life 5-year
rank rank State rank rank rank rank rank rank ($bil) change
1 1 Utah 12 4 6 6 9 15 $124 2.3%
2 2 Virginia 22 2 1 10 18 4 429 0.7
3 4 North Dakota 3 15 18 2 5 19 40 6.3
4 3 North Carolina 2 3 3 21 12 34 440 0.8
5 5 Colorado 32 1 18 14 4 9 264 1.0
6 8 Nebraska 4 27 8 3 37 16 94 1.4
7 6 Texas 23 12 15 1 3 33 1308 2.5
8 11 Georgia 24 6 2 40 11 37 419 -0.2
9 13 Oklahoma 7 36 14 4 18 42 155 1.1
10 10 Iowa 8 40 9 13 40 13 149 1.2
41 39 California 43 30 40 37 1 25 1,959 -0.1
42 40 Wisconsin 35 39 30 29 43 10 255 -0.1
43 32 New Mexico 30 28 33 32 22 49 79 0.4
44 45 Vermont 45 19 49 31 46 14 26 0.0
45 43 West Virginia 13 49 47 19 48 39 67 1.2
46 46 Mississippi 18 48 27 36 50 47 98 0.3
47 47 Michigan 38 50 21 48 40 24 385 -1.7
48 49 Hawaii 50 21 48 38 35 30 67 -0.3
49 48 Rhode Island 41 38 50 49 28 18 50 -0.6
50 50 Maine 40 34 46 44 49 17 52 -0.6
Sources: Moody's Analytics; Pollina Corporate Real Estate; Tax Foundation; Sperling's Best Places;
Mercatus Center; Census Bureau; SBA; FBI; Dept. of Education; Forbes.

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Top Ranked States
• 2006: Virginia, Texas, NC, Utah
• 2007: Virginia, Utah, NC, Texas
• 2008: Virginia, Utah, Washington,
Texas
• 2009: Virginia, Washington, Utah,
Colorado
• 2010: Utah, Virginia, NC, Colorado
• 2011: Utah, Virginia, NC, North
Dakota
• 2012: Utah, Virginia, North Dakota,
NC
• 2013: Will appear in December

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How Communities Can Get Involved
• Places profiled in magazine: Houston (2012);
Detroit (2011); college towns (2009);
Chattanooga, Des Moines (2008), Spokane, Rome
(2007); Albuquerque, Grand Forks (2008)
• Reinventing America series in magazine and
online launched in 2012
• Best States‐typically online only
• Other content: videos with mayors or governors;
op‐ed from Michigan Gov. Rick Snyder

15. So…What Goes
Into Rankings?

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• Definition: The most important aspect to creating any
ranked list: How do you define the topic you are looking to
quantify? What kind of factors or concepts contribute to that
definition?
• Data: How do you measure your definition? What data
exists and how thorough is it? Does it come from a trusted
source? Is it ‘hard data’, meaning numbers and facts that
have been researched and proven? Or is it ‘soft data’ which is
qualitative in nature, opinions or popular sentiment
measured in surveys and polls?

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• Consistency: Is all of your data measured within the same
geographic boundaries? Your measurements need to be
standardized to ensure you are ranking everything evenly
across the same sample size. (Ex: MSA vs. City Limits)
• Accuracy: Are you utilizing your data correctly? Are you
reading the fine print or foot notes? Most important, have
you controlled for variables that skew results (ex: absolute
measurements v. per capita measurements; rolling‐average
for a data set subject to regular changes)

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Coolest Cities Methodology
• Definition: “Cool” is defined by Merriam‐Webster’s dictionary as “very
good; fashionable.”
• Data: We used 7 metrics.
– 1. Entertainment Options per capita (museums, festivals, theater and concert venues) ‐
Sperling’s Best Places
– 2. Recreational Opportunities per capita (green space, the cost and number of outdoor
activities, number of pro and college sports teams) ‐ Sperling’s Best Places
– 3. Restaurants and Bars per capita (focusing exclusively on the locally‐owned businesses
rather than chain restaurants) ‐ Sperlings Best Places
– 4. Cultural Diversity (Diversity Index measuring the likelihood of meeting someone of a
different race or ethnicity) – Sperlings Best Places
– 5. Median Age (higher ranking tied to lower ages) ‐ U.S. Census Bureau
– 6. Net Migration (number of people relocating in 2011) – Moody’s Analytics
– 7. Unemployment Rate – Bureau of Labor Statistics
• Consistency: We measured our geographic entities by Metropolitan
Statistical Area (MSA), as defined by the Office of Management &Budget,
looking at the 65 largest MSAs.

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America’s Coolest Cities
5. Seattle, WA
4. Dallas, TX
3.Los Angeles, CA
2. Washington, D.C.
1. Houston, TX

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Fastest Growing Cities Methodology
• Definition: So‐called Boomtowns, or the fastest growing large metro
areas in terms of both population and economy.
• Data: We used 6 metrics.
– 1. & 2. Population Growth (net growth for 2012 and projected growth
for 2013) – Moody’s Analytics
– 3. Job Growth (2012) ‐ Moody’s Analytics
– 4. Gross Metro Product Growth (local economic growth rate, 2012) ‐
Moody’s Analytics
– 5. Unemployment Rate – Bureau of Labor Statistics
– 6. Income (median salaries for college‐educated workers) ‐ Payscale
• Consistency: We measured our geographic entities by Metropolitan
Statistical Area (MSA), as defined by the Office of Management & Budget,
looking at the 100 largest MSAs.

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America’s Fastest Growing Cities
5. Salt Lake City, UT
4. Raleigh, NC
3.Dallas, TX
2. Houston, TX
1. Austin, TX

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Lessons Learned From Rankings
• It’s All About The Numbers
Your list is only as good as the data you use:
1. Newness. How “fresh” that information is has a huge impact
on the results (ex: home prices; Census data)
2. Size. How large the geographic entities are (New York MSA is
vast w. many suburbs affecting data vs. City Division or even
Metropolitan Division) ; how large the sample size is (comparing
100 cities v. 20 cities)
• Lists Evolve
1. Subjectivity. Every ranking, no matter the data, is going to be
subjective because it rests on your definition. Coolest Cities is
the ultimate example.
2. Change. You can always alter the methodology – or improve
upon it in future incarnations. Again a great example is
Coolest Cities.

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Standout Cities
• Lone Star Metros: Houston; Dallas; Austin;
San Antonio
• ‘Flyover Country’ Metros: Boise, ID; Denver,
CO; Oklahoma City, OK; Provo, UT; Salt Lake
City, UT; Minneapolis, MN; Indianapolis, IN
• Southeastern Metros: Raleigh, NC; Charlotte,
NC; Washington, D.C.

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Takeaways
• Strong local economic data: Dominates when it
comes to “Best Cities” lists, especially for a business‐
centric outlet like FORBES. Perhaps not surprisingly,
areas that have fostered business‐friendly
environments, for example low taxes, Right‐to‐work
legislation, less regulations have typically performed
better economically in the downturn.
• Tech hubs: Every city wants to be one and they
should. Strong correlation between cities facilitating
local tech economies – and startup‐friendly business
environments in general – and high rankings on lists.

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Takeaways
• Young and Restless: Like tech, cities with large young
college‐educated professional populations tend to
clock relatively robust economic growth and rank
high on lists.
• Data Collection: Information, data, and numbers
tend to vary greatly from place to place. In other
words, there is little standardized data from city to
city. It limits methodology for lists and is one of the
major reasons outlets like FORBES limit their
rankings to MSAs and MSADs. This is especially true
for quality of life measurements and lifestyle data.

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Thank You For Joining!
Kurt Badenhausen
www.forbes.com/sites/kurtbadenhausen
Morgan Brennan
www.forbes.com/sites/morganbrennan
DCI
www.aboutdci.com/blog