State’s Climate for Industry Slips a Notch

California’s climate for manufacturing ranked No. 26 among the nation’s 48 contiguous states in 1985, according to a survey of manufacturers released last week.

South Dakota ranked No. 1, as it did last year, followed by Utah and Nebraska, according to the report. South Dakota has no personal income tax, no corporate tax and no property tax. Michigan was No. 48.

The Southwest--Arizona, Colorado, Nevada, New Mexico and Utah--ranked as the best of eight regions. The West--California, Oregon and Washington--ranked No. 7, and the Great Lakes area was No. 8.

The study, titled the “Seventh Annual Study of General Manufacturing Climates of the 48 Contiguous States of America,” was conducted by Chicago-based Grant Thornton, an accounting and management consulting company.

California’s rating slipped slightly from 1984, when the state was ranked No. 25. Among the 22 factors used in calculating the ratings, California ranked No. 1 in population growth. It also had high rankings in the stability of its unemployment compensation program and its high enrollment in vocational education programs.

California was rated poorly in areas such as energy, workers compensation levels and welfare spending because of its relatively high costs.