Factors in Firms' Decisions to Locate or Expand in Kansas: A Sample Survey

Abstract

This monograph reports the results of an Institute for Economic and Business Research survey of Kansas manufacturing firms, either newly in place or that recently expanded their in-state operations. The survey instrument was designed to identify those characteristics of the State's labor market and labor force that encourage or inhibit manufacturing growth in Kansas.

More specifically, this research sought to use the survey results to answer five questions about manufacturing development in the State: • Has it been labor or capital intensive? • Has it depended more on the expansion of existing firms or on the attraction of new enterprises? • How has it been influenced by labor market trends and developments? • How has it been enhanced by labor market trends and developments? • How has it been retarded by labor market trends and developments?

Although limitations both of the data and inherent in the survey method prohibit categorical conclusions, the results of the survey do permit several provisional generalizations: • Growth in Kansas manufacturing has been more capital intensive than in the country as a whole. • It is mostly propelled by the State's proximity to markets. • A number of labor market factors--particularly the State's right-to-work law and availability of labor--appear as locational features attractive to new and expanding businesses. • The relative importance of various factors in the decision to locate in Kansas (and probably the expansion decision) varies in different industries. • The emphasis placed on favorable personal opinions of Kansas suggests that "home-grown" enterprises may be particularly important to the State's manufacturing development. • Tax levels as well as local amenities and facilities appear to be unimportant to the decision to locate or expand in Kansas.