United States Small Business Survey

| April 2 2013

Thumbtack.com has published the results of their latest small businesses survey for 2013. They conduct a survey of questions directly with business owners across the nation and categorize the results by state and by cities. The questions cover a broad range of topics.

1. Overall small business friendliness
2. Ease of starting a small business
3. Ease of hiring a new employee
4. Overall regulatory friendliness
5. Friendliness of health and safety regulations
6. Friendliness of employment, labor, and hiring regulations
7. Friendliness of tax code
8. Friendliness of licensing regulations
9. Friendliness of environmental regulations
10. Friendliness of zoning regulations
11. Training and networking programs

The number of participants comes just under 8,000 businesses surveyed. After aggregating all the data on a per-locale basis, they produce a letter grade and also indicate an improvement or detriment in comparison to the previous year’s survey.

Looking over the results, I took note of following highlights.

  • Arizona slightly improves over its past grade, moving from a C to a C+.  The state earns an A- in ease of hiring, but a C+ overall.
  • The five worst states were Rhode Island, Maine, Michigan, Illinois, and California
  • The four best states were New Hampshire, Alabama, Idaho, and Utah.  A handful of others tied for the fifth best.
  • Unemployment figures by state averaged over 2012 somewhat correspond to the survey, at least on the bottom end.  The five highest include Nevada, California, Rhode Island, North Carolina, South Carolina, and Michigan.  Not so in line with the survey however, the five lowest include North Dakota, Nebraska, South Dakota, Vermont, Iowa, and Oklahoma, with the last two in a tie.

One of the survey’s creators shared the following highlights with me.

  • Texas had three of the top five cities (Austin, Houston and San Antonio), while California was home to three of the bottom five (Los Angeles, San Diego and Sacramento). Newark, NJ finished last in this year’s rankings.
  • Professional licensing requirements were 30% more important than taxes in determining a state’s overall business-friendliness, confirming similar findings from last year’s study. Furthermore, this year’s research revealed that 40% of U.S. small businesses are subject to licensing regulations by multiple jurisdictions or levels of government.
  • Small businesses were relatively unconcerned with tax rates – more than half of small business owners feel they pay about the right share of taxes.
You can investigate the details of the survey and related data at these links.
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