The Business Case

Business engagement in the fight to advance nondiscrimination policies and prevent anti-LGBTQ bills from becoming law is more important now than ever before. In fact, businesses have become some of the most powerful and committed proponents of nondiscrimination measures. These policies are vital for attracting and retaining top talent, fostering innovation, and maintaining and growing economic competitiveness.

That’s why we’ve seen a surge of state business coalitions in recent years, many of them with FFAA as a founding partner. These coalitions represent thousands of employers, and give corporate America and small business owners a voice on the clear business case for nondiscrimination.

It’s time to harness and centralize the power of business engagement through a coordinated, national coalition.

That’s why we developed America Competes as a central organizing platform for businesses looking to engage externally on issues of nondiscrimination. Businesses participating in America Competes get real-time legislative analysis; strategic guidance on where and when to engage in advocacy efforts; and the best messaging, social media support and research available. Businesses also get connections to state business coalitions all over the country – an essential component for rapid response in a fast-moving environment. 

Economic Imperative

While business leaders and economic development experts have been arguing for years that discriminatory measures have tangible negative impacts on economic conditions, that fact is now indisputable. North Carolina and Indiana both experienced significant ramifications following the enactment of anti-LGBTQ laws, Texas tracked hundreds of millions of tourism dollars on the line in 2017, Oklahoma reported tens of millions in negative publicity in 2016, and states like Georgia, Louisiana, Mississippi, Arizona, and Tennessee all have hard data to back up the economic risk they faced in recent years. And a 2017 meetings industry survey found that 47% of meeting planners say they will “absolutely” avoid planning conferences, conventions, and other events in states that pass discriminatory legislation.


North Carolina

North Carolina’s HB 2 law – which banned transgender people from using restrooms in public schools, universities and government buildings –gained national headlines. But a growing body of evidence makes it clear that there’s more than just headlines and political posturing – the law has cost North Carolina more than $600 million in publicly reported in lost revenue since it was enacted:

  • The Charlotte Chamber estimated that the law cost the region approximately $285 million by May 2016 – just two months after enactment.
  • PayPal withdrew a planned investment from North Carolina – costing the state hundreds of jobs and at least $4 million in investments.
  • Deutsche Bank also canceled an expansion into the Tar Heel State, costing $27 million and 250 jobs.
  • The Greater Raleigh Convention and Visitors Bureau estimates the law has cost their region north of $40 million as of summer 2016.
  • Greensboro has lost about $6 million from conferences that have relocated, while Asheville estimates losses around $2 million.
  •  CoStar relocated a planned research operations center to Richmond, Virginia rather than Charlotte – specifically because of HB 2. The missed opportunity cost Charlotte 730 jobs and approximately $250 million in investments.
  • The Charlotte Regional Visitors Authority estimates the NBA’s removal of the 2017 All-Star Game from Charlotte cost the region at least $100 million in lost revenue.
  • The NCAA relocated seven championship games, which officials in Greensboro expect cost them more than $16 million, while officials in Cary estimate they’d lose around $2.5 million.
  • The ACC pulled its title game and six other championships from North Carolina, costing Charlotte as much as $30 million based on revenue from the 2015 game.

Texas

Businesses and associations of all sizes are making clear that SB 6 and HB 2899, 2017 bills that closely mirrored North Carolina’s HB 2 law, would have had a disastrous impact on Texas’ flourishing economy.

  • The Texas Association of Business – the state chamber of commerce – commissioned an economic impact study that found that anti-LGBTQ legislation would cost Texas $1.04 billion in loss of conference and capital investments through 2026, with an additional $4.1 billion at potential risk, and an additional $450 million in sporting event losses
  • An independent study by Waco, TX economist Ray Perryman found that a so-called “bathroom law” would result in a travel and tourism industry loss of $5.5 billion in annual gross product and 59,600 jobs over time, with yearly losses in state revenue of $295.2 million, and a $141.1 million yearly decrease in local fiscal resource.
  • In 2017, Texas tourism leaders reported that the ongoing bathroom bill debate resulted in $66 million in confirmed lost convention business, before any bill became law. If a bathroom bill had become law, those tourism leaders reported that they were poised to lose additional $1.4 billion in conventions, sports championships, and similar events
  • In 2015, the Texas Association of Business opposed a broad rewriting of Texas’ existing Religious Freedom Restoration Act, on that grounds that the legislation “will certainly make our state look very much unwelcoming when it comes to business recruitment.”

Indiana

Indiana experienced an immediate and measurable economic backlash to its own anti-LGBTQ legislation, SB 101, in early 2015. That’s when Indiana lawmakers passed – and then-Governor Mike Pence signed into law – a policy that allowed for discrimination against LGBTQ people on religious grounds.

  • Visit Indy reported that Indianapolis lost more than $60 million in economic opportunities, including the loss of at least 12 conventions, in the weeks before a “to the law fix” was enacted.
  • Angie’s List halted a $40 million, 1,000-job corporate investment until the law was amended to ensure it could not be used to discriminate
  • The state lost “millions” in hotel bookings for 2018, resulting in a $12 million tax revenue decline
  • The measure also generated an estimated 1 billion negative social media impressions about the state, and some 2,500 stories in just 30 days.
  • After the law’s enactment, the Indiana Economic Development Coalition found that nearly 83 percent of economic investment commitments and 58 percent of new high-wage jobs were awarded to municipalities with ordinances that protect LGBTQ people from discrimination.

Oklahoma

Oklahoma’s 2016 attempt to pass a “bathroom bill” resulted in swift, bipartisan backlash:

  • The Tulsa and Oklahoma City chambers of commerce stated that “passage of SB 1619 would halt growth and success in our states tourism and economic development efforts, causing significant and immediate revenue losses.”
  • The debate over the bill contributed to $50.9 million worth of bad publicity about the state, according to a report commissioned by the Tulsa Regional Chamber

Arizona

In 2013, the Arizona legislature passed a “religious refusal” bill, SB 1062. Governor Jan Brewer vetoed the bill in 2014 the face of the economic evidence:

  • Economists estimated the tourism damage from the bill would have been more than $140 million in lost meetings and conventions in the first three years
  • State tourism leaders worried that the Super Bowl – an event with a $500 million impact – was on the line after the NFL expressed concern over the measure
ECONOMIC OPPORTUNITY

While the business community is focused on combating discriminatory measures in some states, other cities and states are noticing – and reaping – the benefits of an inclusive environment. Municipal and state nondiscrimination protections are crucial tools in the war for talent, tourism, and investment. Allowing employees to bring their full and authentic selves to work ensures a best-in-class workforce that increases productivity and economic opportunity

  • A 2013 Detroit Chamber of Commerce study found that 38% of Michigan’s college-educated “brain drain” is moving to more LGBTQ-inclusive states
  • A 2016 peer-reviewed study published in Management Science found a causal effect: when a state passes employment nondiscrimination protections for LGBTQ people, more innovators move into the state. Those innovators file more patents than people leaving the state, and the firms headquartered in those see an 8% increase in the number of patents they file
  • Fort Worth, Texas officials said that Facebook executives “studied the city’s (LGBTQ-inclusive) non-discrimination ordinances” before announcing a new $1 billion data center investment in 2015 (Fort Worth has a fully LGBTQ-inclusive non-discrimination ordinance in place)
  • GE called Georgia Governor Deal’s 2016 veto of a “first amendment defense act” “definitely pertinent” to the decision to locate its $3m, 250-job digital HQ in Atlanta: “…we would be hard-pressed to set up operations any place that discriminated on any basis,” said Jim Fowler, GE’s chief information officer
  • A 2016 study found that Florida can boost its total economic output by $5.46 billion over the next 10 years, linked to the creation of 35,759 new jobs, by enacting employee non-discrimination legislation and boosting its attractiveness to skilled and innovative labor . Florida’s productivity would grow by $3.46 billion in gross product over a 10-year period.
  • A conservative calculation of Florida losses due to the absence of nondiscrimination protections—based on lost productivity and turnover alone—reduces the collective bottom line in Florida by more than $362 million annually