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Competitiveness Analysis 2025

What will it take to win Arizona's next decade?

Winning the Next Decade and Beyond

Explore the Playbook Download the Report
A project of

ArizonaW1NS

Arizona has achieved tremendous economic success over the past decade and is positioned well for continued growth.

But competitiveness is not static. As natural population growth slows and competition for talent, capital, and innovation intensifies, Arizona must assess and strengthen its competitive advantages to maintain its economic momentum.

ArizonaW1NS is the plan to win Arizona's next decade and beyond, with a comprehensive set of strategies and tactics to advance business development, provide more high-wage jobs, and grow opportunity for Arizonans statewide.

50+
Improvement opportunities identified across key factors of competitiveness
200+
Arizona business and civic leaders contributed ideas and aspirations
24+
States have already launched formal competitiveness plans

Arizona by the Numbers

A decade of extraordinary growth and transformation

$0B
State GDP
Up from $150B in the late 1990s
#1
Largest Growing County
Maricopa County, 2020-2023
Top 5
State for Growth
465,714 new residents, 2020-2025
0M
Total Population
Projected to reach 9M by 2040
0%
Job Growth, 2014-2024
Nearly double the U.S. average of 13.4%
0%
Real GDP Growth
Past decade, among top nationally
5th
Largest City in the U.S.
Phoenix
0
Potential New Jobs
In the ACA project pipeline
Semiconductor advanced manufacturing facility

Arizona's Decade of Transformation

Arizona's economic transformation since the 2008 global recession is certainly the envy of most states.

A broad economic recovery and diversification strategy was enacted, with an emphasis on high-wage jobs, highlighted by significant tax reductions, regulatory reform and a revamped approach to statewide economic development through the creation of the Arizona Commerce Authority.

With its economy transformed, the question facing Arizona now is, "How does Arizona win the next 10 years?"

2025
Gold Shovel Award
Area Development
7 Years
Consecutive Gold Shovels
2019 - 2025

The Framework for Competitiveness

Four pillars of competitiveness that matter most to business and talent location decisions

Business Climate

  • Taxes
  • Regulatory Climate
  • Legal Climate
  • Insurance

Workforce

  • In-migration
  • Education/Skills
  • Productivity
  • Costs
  • Quality of Life

Infrastructure

  • Power
  • Water/Sewer
  • Transportation
  • Broadband
  • Housing/Child Care
  • Buildings & Sites

Innovation

  • Advanced Industries
  • R&D
  • Start-up Ecosystem
  • Automation

Arizona's Most Urgent Priorities

The top five priorities for Arizona's next five years

1

Enhance Competitiveness

Sharpen Arizona's competitive edge through enhanced economic development tools and ease zoning processes to expand business and infrastructure.

2

Accelerate Talent Development

Strengthen and grow education, training, and career pathways that prepare Arizonans for high-wage, in-demand jobs.

3

Strengthen Critical Infrastructure

Make Arizona a top state for energy and water availability and affordability.

4

Spur Innovation

Catalyze innovation and entrepreneurship through research and development and speeding tech transfer.

5

Preserve Quality of Life

Drive down costs that threaten Arizona's economic momentum and capitalize on federal policy reforms to keep Arizona in the lead.

The Playbook for Arizona's Next Decade

Strategies and recommended actions organized by pillar

Business Climate and Competitiveness

Enhance Arizona's business climate and modernize the economic development toolbox.

Keep Arizona a top state for business through competitive tax rates, low regulatory burdens, and a strong legal environment.

Equip the Arizona Commerce Authority with the resources and tools needed to successfully compete.

Encourage regional and local economic development planning and speed processes to expand business and infrastructure.

Maintain fiscally stable governments and a predictable policy environment.

Recommended Actions

  • Increase consistency in local planning and zoning requirements.
  • Recognize private property rights in business and infrastructure development.
  • Enhance local community outreach and education on economic benefits of business and infrastructure expansion projects.
  • Renew and replenish Arizona Competes Fund.
  • Combine Qualified Facility and Quality Jobs tax credit funding to create a refundable credit pool.
  • Create an Arizona Job Training incentive program to expand technical skills training across Arizona.
  • Extend the Transaction Privilege Tax exemption for cleanroom construction to all cleanrooms, regardless of industry.
  • Build and operate dedicated training centers for mega projects.
  • Support the creation of robust economic development plans at the local level that reflect special capabilities and strategic assets.
  • Enhance statewide coordination with sector strengthening plans, such as Flinn Foundation's Biosciences Roadmap.
  • Uphold individual and business rights to contract.
  • Safeguard Arizona's status as a right-to-work state.
  • Vigorously protect private property rights, including intellectual property rights.
  • Set reasonable limits on business liability and damages.
  • Support use of business courts to expedite business proceedings.
  • Prepare the state budget for potential changes in federal program eligibility and funding formulas.
  • Develop multiyear budget plans, conduct regular financial stress testing, and improve cash balances.
  • Build additional budget contingency plans.
  • Maintain the highest bond ratings to reduce costs of borrowing.

Workforce and Education

Expand the talent pipeline and opportunity for working Arizonans.

Provide Arizonans lifelong learning and training opportunities to advance their careers.

Modernize the state's approach to enhance education and training for students and working-age adults.

Accelerate workforce support in high demand fields.

Help working-age adults stay in the workforce, so they can support their families.

Recommended Actions

  • Improve Education and Career Pathways to increase high school retention, boost graduation rates, and prepare students for work.
  • Integrate AI into the K-12 curriculum; expand STEM offerings statewide.
  • Raise awareness of high-growth, high-wage careers for students and parents, starting in middle school.
  • Expand access to Career and Technical Education (CTE), dual enrollment, and industry-recognized credentials.
  • Make credentials "stackable" to facilitate earning additional certification or a degree.
  • Expand CTE programming statewide aligned with high-wage, high-demand industries.
  • Create more work-based learning opportunities including internships, apprenticeships, and mentorships.
  • Support AZ Healthy Tomorrow to expand nursing, allied health and advanced professional health care programs.
  • Continue to expand the capacity of Arizona's engineering schools to match workforce demand.
  • Expand Graduate Medical Education and other medical practice pathways.
  • Fuel talent in high-demand specialties like science, manufacturing, water, technology, and engineering.
  • Provide ongoing operating funds for recently established training programs aligned to industry demand.
  • Support students enrolled in degree and certificate programs in high-wage, high-growth industries.
  • Fund non-credit workforce coursework and stackable credentials related to employment skills training.
  • Create a dedicated state funding pool for working-age adults to complete training programs at accredited post-secondary institutions.
  • Expand adult education opportunities to boost skills among the estimated 680,000 Arizonans with less than a high school diploma.

Energy and Infrastructure

Strengthen Arizona's physical infrastructure for future growth.

Expedite plans to secure power and water to meet future demand and position Arizona at the forefront of grid modernization.

Expand Arizona's physical infrastructure to accommodate population growth, promote business development, and facilitate the movement of goods.

Accelerate broadband implementation statewide.

Recommended Actions

  • Adopt a flexible "all of the above" approach to energy generation including natural gas, nuclear, renewable, and energy storage.
  • Shore up baseload generation with reliable, scalable, and sustainable power resources.
  • Streamline infrastructure permitting and regulatory processes for transmission and generation projects.
  • Promote energy innovation by encouraging research and pilot programs for emerging technologies.
  • Maintain regulatory certainty, consumer protections, and stable water governance.
  • Invest in long-term planning and water augmentation.
  • Address gaps in statewide water management.
  • Protect Arizona's Colorado River water supply.
  • Expand transportation corridor between Phoenix and Tucson to reduce travel time.
  • Improve airline offerings for business and leisure travelers to southern Arizona.
  • Leverage the state's historic broadband investments to enable rural business expansion.

Innovation and Entrepreneurship

Catalyze Arizona innovation and entrepreneurship.

Spur innovation to create new business ventures, technologies, and jobs.

Speed Arizona's public university discoveries and intellectual property to market.

Encourage entrepreneurship and the creation of small businesses.

Improve access to capital to provide resources to launch and scale business ventures.

Recommended Actions

  • Explore improvements to the R&D tax credit such as adding transferability or refundability at discounted rates.
  • Expand other state-based R&D efforts through state agencies and universities.
  • Implement an ongoing research facilities bonding and renewal program.
  • Create a statewide strategy to ease and expedite the transfer and licensing of technology from public universities.
  • Create incentives for the deployment of technology transfer by companies based in Arizona.
  • Expand spaces for collaboration and testing between universities and the business community.
  • Strengthen Small Business Development Centers (SBDC) statewide in partnership with community colleges.
  • Facilitate access to capital for entrepreneurs with larger in-state venture capital and angel investing programs.

Addressing Risks

Mitigate risks to economic momentum and quality of life.

Improve housing affordability.

Capitalize on federal policy reforms to support Arizona-based businesses and lead on domestic production.

Protect public safety and border security measures.

Keep Arizona a top place to recreate and enjoy the outdoors.

Recommended Actions

  • Speed time to build and reduce costs through common, streamlined regulations at local level.
  • Lower the cost of financing for building new housing units via public/private partnerships.
  • Position Arizona to win federal onshoring and reshoring initiatives, like the CHIPS Act.
  • Expand eligibility and locations of Foreign-Trade Zones (FTZs).
  • Encourage federal immigration reform to address critical workforce shortages.
  • Enhance Arizona's role as a producer of critical minerals to support supply chain resilience.
  • Maintain strong public safety, sentencing, and corrections policies and continue aggressive border security measures.
  • Seek to improve health outcomes to boost worker productivity and reduce health care costs.
  • Support Arizona's ability to compete for major sporting events.
  • Leverage Arizona's natural amenities by expanding investments in parks, trails, arts, and outdoor recreation.

Measuring Success

Establishing an Arizona Competitiveness Index

To track the impact of policy and the business climate over time, Arizona should regularly measure itself on key indicators that show its overall favorability and attractiveness compared to other states.

1 Rank in top 5 states for overall job growth
2 Rank in top 5 states for net in-migration
3 Rank in top 5 states for GDP and GDP per capita growth
4 Rank in top 5 states for new business formations
5 Rank in top 5 states for public research and development growth
6 Rank in top 5 states for labor force growth
7 Growth in educational attainment among working age Arizonans
8 Improvements in Arizonans' health on five leading indicators

ArizonaW1NS Leadership

David Rousseau

David Rousseau

Chair

President, Salt River Project

Hon. Eileen Klein

Hon. Eileen Klein

Co-Chair

35th State Treasurer of Arizona
President, Arizona Chamber Foundation

Sandra Watson

Sandra Watson

Co-Chair

President & CEO
Arizona Commerce Authority

Andrew Bertsch — 2026 ArizonaW1NS Intern, Arizona State University

Supporters

ArizonaW1NS is made possible by generous support from the State of Arizona, with funding provided by the Arizona Legislature and Governor Katie Hobbs.

Amazon
Arizona Public Service
Arizona Board of Regents
Salt River Project

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