In a tough economic environment, how do smart states create jobs? By attracting companies to invest and grow there.

And according to Site Selection magazine, a "corporate real estate strategy and area economic development" publication, Texas is one of the best at it.

Site Selection's annual list of the top state business climates is based on their own new plant database, which tracks new and expanded business facilities, and a survey of "corporate site selectors" on which states they felt were appealing.

Texas is ranked third overall, coming in second on the executive survey ranking, second in number of new plants in 2009, ninth in new plants in the first eight months of 2010, and third in overall competitiveness.

Site Selection credited governor Rick Perry's strategy, as he described it at the October "Keeping Texas Competitive" summit in San Antonio:

“The economic principles in place in Texas emphasize the balance between personal freedom and responsibility, not only helping strengthen our economy, but attracting jobs for Texans,” Perry said. “We will continue to embrace low taxes, predictable regulations, limits on lawsuits and accountable schools as we move into the upcoming legislative session and continue to lead the nation in job creation.”

North Carolina came in first in the rankings, followed by Tennessee.

Is there something special about the South? Eight of the top 10 states were from the region.