Virginia was founded as a business venture more than 400 years ago. The Virginia Company of London was a joint-stock company formed both to bring profits to its shareholders and to establish an English colony in the New World. That entrepreneurial spirit continues to grow strong in Virginia. Here in the commonwealth we have worked across party lines to put in place policies that have spurred private-sector job creation and helped lead to a growing economy. More than 400 years after our founding, Virginia is indeed the best place for business.
I was elected with the promise to make Virginia a jobs magnet and to do everything I can to help our state attract more employers so our citizens can get the good jobs they need and deserve. Our commitment to keep taxes low and regulations and litigation to a minimum has freed the private sector to create jobs and opportunities for our citizens. Since taking office, more than 170,000 net new jobs have been created in Virginia. Of those 170,000 net new jobs, more than 150,000 are in the private sector.
Our unemployment rate has now fallen from 7.3 percent the month we took office to 5.3 percent today—Virginia's lowest unemployment rate in 4½ years. We have the lowest unemployment rate in the Southeast, the second-lowest rate east of the Mississippi River and our unemployment rate stands more than a full point lower than any of our neighboring states.
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This economic growth is the result of our incredible private-sector job creators and workers who are taking risks and growing their businesses and our economy with their smart choices and hard decisions. And it is also the result of the pro-job creation policies we are implementing here in Richmond, with their input and insights, to help them be successful. It is a partnership, and it is a balance. There are policies that state governments can put in place that will help the private sector grow. And, equally, there are policies that can get in their way. We've worked tirelessly to get this balance right. We want state government to help the private sector where it can, and to get out of the way where it cannot.
We have made the right choices by prioritizing investments into high-growth sectors and maximizing existing resources. This year we passed Virginia's first comprehensive transportation funding initiative in 27 years. Without a modern transportation system, our future economic growth would remain in jeopardy and private sector job-creators would have a harder time moving goods to market, expanding their enterprises, and hiring new workers. For nearly three decades Virginia had failed to adequately invest in transportation infrastructure. The situation had a reached a crisis point and job-creators were telling us clearly: our transportation system was not ready for the 21st-century economy.
This failure by Richmond to provide necessary infrastructure was a direct threat to future private-sector job creation and economic development in the commonwealth. So we took action. As a result shovels have already hit the ground and Virginia's aging infrastructure is being transformed into a world class transportation system that will continue to create jobs and opportunity in every corner of the commonwealth.
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In today's increasingly knowledge-based economy, education is also essential to job creation and economic development. Virginia is among the best-educated states in the country, issuing nearly 83,000 associate, bachelor, master, and doctoral degrees at its public and private institutions last year. More than 500,000 students are enrolled in over 100 in-state institutions of higher education. As part of Virginia's education system, there are 23 community colleges with transferable programs across the state. As a result, Virginia's higher education system is the 11th-largest in the nation.
A tradition of lifelong education means that Virginia's workforce is consistently prepared for changing technologies. Virginia therefore delivers a pipeline of skilled applicants for companies today and for industries of the future. But this world-class education system requires world-class funding. We've put new resources into our higher education system and brought new funding to our colleges and universities after a decade of disinvestment. The result? We've added 3,800 new slots for in-state undergraduate students in just the last two years, and we're on pace to award 100,000 more degrees over the next 15 years. Last year we saw the lowest average yearly tuition increase at our state schools in a decade. We're making college more affordable and accessible for Virginia students: the future of our economy.
Virginia's economic diversity and adaptability are its strengths. Even during periods of economic slowdowns, the commonwealth has suffered less and recovered sooner than most states. Virginia's ability to respond to adversity can be attributed to a variety of factors, including a pro-business regulatory environment that offers lower operating costs, a stable 6 percent corporate income tax—one of the lowest in the nation—that hasn't increased since 1972, property tax exemptions and one of the lowest combined state/local/use taxes at 5 percent. We budget conservatively.
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We invest in the core functions of government critical to private sector job creation and quality of life, and we get government out of the areas where it should not be, and where it does not have a positive role to play. That's how we've posted budget surpluses each year of our administration, while at the same time more than doubling the state's rainy day fund and reducing the future unfunded liability in our state pension system by $9 billion.
We are also leading the nation in strategically targeted incentives for emerging industries. Virginia views incentives as an investment in its economic future and as a basis for a rational business decision for both the commonwealth and the companies. The recently adopted Clean Energy Manufacturing Incentive Grant, for example, is designed to provide financial incentives to companies that manufacture or assemble equipment, systems, or products used to produce renewable or nuclear energy or products used for energy conservation, storage, or grid efficiency purposes.
Virginia also offers extremely competitive sales and use tax exemptions for large data center operations, including critical servers, routers, chillers, generators and enabling software. The Governor's Opportunity Fund is a vital, proven deal closing incentive that Virginia and its communities have successfully used for almost two decades. Robust incentives like these are proven to attract new business and support and encourage the growth of companies in Virginia.
We came to Richmond with a singular focus on growing our economy and helping the private sector to create good paying jobs in every section of the commonwealth. Working across party and regional lines, we have done that. Today unemployment is down in Virginia. More Virginians are working. And more businesses are calling the commonwealth home.
Since our founding as a business venture more than 400 years ago, Virginia continues to pioneer innovation, creating an environment that fosters entrepreneurship and spurs economic growth for the 21st century.
—By Virginia Gov. Bob McDonnell
Read more blogs from U.S. governors here.