Building Permits — Some of the new business permits issued this past week are for the Coca-Cola Bottling project in Birmingham. (Nathan Watson / Bham Now)

Alabama has been recognized among the top 10 states for doing business, according to Area Development magazine.

The publication recognized our state for being the best in three different categories including:

Overall Cost of Doing Business
Property Tax Environment
Labor Cost Competitiveness

Those three metrics helped Alabama stand out, ranking No. 7 among all states. That’s up one spot from the state’s No. 8 ranking in 2024 and 2025.

“Alabama is, indeed, open for business. This latest ranking by Area Development sends a clear message that Alabama is one of the most business-friendly states in the nation, offering the policies, infrastructure, skilled labor and space for companies to thrive.
Gov. Kay Ivey

Keep reading to see where Alabama ranks in all the Area Development categories and what other states made the top 10.

54716901175 E8022Eab59 O Scaled E1755025786491 — Governor Kay Ivey gave remarks and participated in the ribbon cutting for the Pepsi Distribution Center Grand Opening Tuesday August 12, 2025 in Luverne, Ala. The new expansion allows Pepsi Luverne to move the 100-year-old business from its 40,000-square-foot building in downtown Luverne because of inadequate space to grow. The new facility is a 75,000-square-foot building on a 17-acre site off U.S. Highway 331 and Richburg Hill Road.(Governor’s Office/Hal Yeager)

Alabama ranks No. 7 best state for doing business

Area Development covers corporate site selection, facility planning and economic development. To determine which states are best for businesses, the publication uses a set of metrics.

Alabama ranked in the top 10 of 15 different metrics including:

No. 3 — Business Incentives Programs
No. 4 — Regulatory Environment
No. 4 — Permitting and Development Predictability
No. 5 — Cooperative Local and State Government
No. 5 — Workforce Training Programs
No. 6 — Energy Availability & Grid Capacity
No. 7 — Overall Speed-to-Market
No. 7 — Site Readiness Programs
No. 7 — Availability of Industrial Sites and Buildings
No. 8 — Energy Cost
No. 8 — Access to Skilled Manufacturing Labor
No. 10 — Engineering Talent and Industry Cluster Strength

Alabama’s climb up the list follows a record 2025 in which the state announced $14.6 billion in new investments and more than 9,000 new jobs.

“Alabama’s continued recognition by Area Development is a strong validation of the work we are doing to make our state an increasingly competitive place for investment and job creation… They need development-ready sites, a skilled workforce, reliable energy, predictable permitting and communities that are ready to move quickly when an opportunity comes their way. Alabama has been making deliberate investments in each of those areas, and these rankings reflect that progress.”
Ellen McNair, Commerce Secretary

Best states for doing business according to Area Development

Area Development’s 2026 rankings were created by 50 site consultants who evaluated states across 20 factors, showing how workforce, infrastructure, government execution, costs and risk combine to create, or undermine, project-level certainty.

Georgia took the top spot for the 13th year in a row.

Here is the full top 10: