Capital: E & Y study captures data on investments.

Foreign investments represent roughly 15 percent of the money coming to a surveyed pool of U.S. companies, and up to 40 percent in some manufacturing industries. Also, out-of-state investors represent almost half of the total investments--considerably greater than the one-third coming from in-state investors.

Those were among the chief findings from a the first annual U.S. Investment Monitor (USIM), an economic report from Ernst & Young LLP that tracks and analyzes business capital investment location decisions within the U.S.

The U.S. Investment Monitor analyzed 4,300 major business investments during 2004, which totaled $110 billion in domestic and foreign capital investment and created more than 550,000 jobs. The report was prepared by the Quantitative Economics and Statistics (QUEST) practice of Ernst & Young and the firm's State and Local Tax Group.

"State economic development must focus on growing companies headquartered in-state, as well as attracting new investment from foreign and out-of-state companies," says Tom Neubig, Director of QUEST. He added: "The report confirms that the U.S. continues to offer attractive investment opportunities for foreign companies. The numbers also show that U.S. facilities, employees and markets remain key parts of the global strategies of U.S. multinationals."

The USIM departs from typical analyses of aggregate business investment trends by analyzing specific projects that meet industry, use and size criteria, capturing the business investment and location decisions that drive economic growth.

Among the survey's chief findings:

* Major business investments, each involving more than 20 jobs or $10 million in capital, represent 40 percent of the 2004 net growth in U.S. business facilities and equipment.

* Investments by foreign companies and their affiliates represent more than 15 percent of the total capital invested in these projects, and approach 40 percent of total capital investment in several manufacturing industries.

* Manufacturing projects created the vast majority of total capital investments in 2004 and were the source of the greatest number of new jobs.

* In 2004, investment into Texas, home to energy industries and chemical manufacturing, far surpassed that of the other top five states (Michigan, Ohio, California and New York).

The report not only breaks down state-specific investments and state-to-state flows of capital by industry, it also shows direct foreign investment by country. Copies of the U.S. Investment Monitor can be obtained at: ww.ey.com/us.