Missouri ranks 37th on New Economy Index
The Kauffman Foundation and the Information Technology and Innovation Foundation have updated their New Economy Index, and the news for Missouri isn’t good. The show-me state ranks 37th, a drop of two places since last year’s report. (The authors say, however, that we shouldn’t compare this year’s results with last year’s because they have changed the criteria.)
Illinois fares much better: It ranks 16th, just where it placed a year ago.
The foundations say the index is designed to measure the economic structure of a state, as opposed to its performance or government policies. The most successful states in the years ahead, they say, will be those with a high degree of global connectedness, a high concentration of knowledge workers and a lot of export-oriented manufacturers.
The index is a composite of 29 separate indicators. Missouri does best, with a No. 12 ranking, in the concentration of high-wage services jobs. It ranks lowest, 45th, on a measure of job churn. (In this report, turnover is good because it indicates a vibrant economy with a lot of business startups.) Illinois ranks as high as 10th, in the proportion of managerial, professional and technical jobs, and as low as 24th, in knowledge-worker immigrants.
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David Nicklaus has covered St. Louis business for more than 25 years. His column appears three days a week on the Post-Dispatch business page. 
Let’s not automatically assume that a high ranking in the so-called “new economy index” is better than more conventional parameters such as the average income per capita and the average educational level per capita. While “information technology” obviously has its benefits, those like everything else are subject to the law of diminishing returns. At some point, the capacity to produce such “basic” items as corn, automobiles, and houses, and “advanced” services such as healthcare and air transportation that may not be included in the “new economy index,” will become equally important or more important than further refinements in electronic devices and software.
Missouri or anywhere else that understands how to apply information technology to all of the other goods and services that it produces will benefit just as much as by having its economy dependent on information technology per se.
Information technology’s