How is the Commonwealth of Virginia performing economically?

The Commonwealth of Virginia’s gross state product was last measured at $480 billion (November 2016). With a population of 8.411 million people, the median household income is well above the US average, at $65,015. In 2016, Virginia’s job growth was measured at 2%, and Moody’s allocated a triple-A rating to the state. On the Forbes list of best US states for doing business, Virginia ranks at #6.

virginiaVirginia is among the highest-ranking states in terms of labour supply (#2) and regulatory environment (#3). However, there is certainly room for improvement, since it ranks at #29 in terms of business costs, and #33 for its economic climate. In 2013, Virginia was ranked as the best US state for doing business, and for the seven years between 2006 and 2013 it featured in the top 2 states. In terms of diversity of economic offerings, Virginia offers farming, government, manufacturing, military and local economic opportunities.

 

Increased Efficiency of Operations Nullifies Decreased Fed Funding

The World Economic Forum ranked the United States at #3 in terms of global competitiveness in 2015. In the same year, the National GDP (gross domestic product) in the US was $55,805. Given that Virginia’s GDP is $65,000, it is significantly above the mean. In 2015, Forbes Magazine assigned a #7 ranking to Virginia for the best state for doing business in the US.

Clearly, Virginia has been able to maintain efficiency of operations amid growing global economic uncertainty. Virginia’s status as one of the most efficient and productive states in the union remains ironclad. The business-friendly environment and high-quality labour market are fueling growth prospects, despite fluctuations in rankings. Federal spending has decreased in recent years, and growth has slowed, but the state has reacted with increased efficiency of operations.

 

Excellence in Operations for Small Businesses in Virginia

Among the many areas where Virginia can upgrade its status in terms of national competitiveness are quality-of-life for Virginia residents, the provision of reliable transportation infrastructure, and improved educational prospects. Currently, Virginia’s state tax ranges between 2% on the low end and 5.75% on the high end. There are 4 tax brackets in the state. According to CNNMoney, Virginia ranks at #15 with a personal tax rate of 28.86, and a total tax ranking of 43 with a figure of 95.18.

Recently, the SPQA and the Virginia OED selected 6 businesses which have contributed significantly to the state’s economic growth. According to the Office of Economic Development and the Senate Productivity and Quality Award Program, the businesses that are prospering in 2017 include the following: Systems Engineering Inc, RMGS Inc, National Security and Door Corporation, JR Caskey Inc, Highground Services Inc, and Intellectual Point.

The Virginia OED and SPQA will provide these organisations with 1 year of complimentary training on business processes. They will also be provided with mentors, feedback and opportunities to improve their services. This ongoing program is geared towards assisting small businesses to stay productive and remain profitable. Given that these 6 businesses have shown promise in business expansion, employment creation, and growth prospects, they will continue to remain a beacon of hope in the Commonwealth of Virginia.

 

Highly Developed Credit Sector in Virginia

Companies with strong financial performance tend to have higher levels of cash flow and better balance sheets. However, there are many businesses in Virginia that are not on the top money lists, yet they still qualify for short-term financing from bank and non-bank lenders. One of the measures of a state’s competitiveness is the development of its credit sector. Businesses in need of short-term loans and financing can easily qualify, provided they meet the criteria. These include at least 6 months in business, a credit score of 500+, and annual revenues in the region of $100,000 +.

The application process itself will vary from business to business, however there is plenty of discretion when it comes to short-term loans. Typically, the maximum loan amount is $250,000 with a loan term anywhere between 3 months and 18 months. Many businesses in Virginia have opted for short-term loans from non-bank financial institutions, given that there is less regulation to contend with, and a wider range of credit scores are accepted. The downside of short-term financing is that costs of short-term loans are higher than long-term loans, and businesses with variable revenues may struggle to make timely payments.

It’s clear that companies in Virginia are well-positioned for robust growth. It’s also good to know that there are available opportunities to help finance businesses that may be in need of additional liquidity.



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