Austin and Virginia Beach ranked most business-friendly cities
Jul 6 2013
I received a request to post this info back in April, but just now had the time to get it on the blog. It’s a bit dated but still useful especially since Austin, Texas made the list for being one of the most friendly places for small businesses!
Small Businesses Rate Utah and Alabama Friendliest States, California and Illinois Among Least Friendly. Austin and Virginia Beach ranked most business-friendly cities.
(San Francisco, Calif.) April 2, 2013: Thumbtack.com, in partnership with the Ewing Marion Kauffman Foundation, today released the second-annual Thumbtack.com Small Business Friendliness Survey showing that Utah, Alabama, New Hampshire, Idaho and Texas rated as the top-five friendliest states for small business. In contrast, small business owners gave Hawaii, Maine and Rhode Island an “F,” while California and Illinois rounded out the bottom five, both earning a “D” grade. The top performing cities were Austin, Virginia Beach and Houston.
The Thumbtack.com Small Business Friendliness Survey is the only survey to obtain data from an extensive, nationwide universe of job creators and entrepreneurs in order to determine the most business-friendly locations. While there are various “business climate rankings” that rate locations as good or bad for business, there are no others that draw upon considerable data from small business owners themselves.
“Small businesses are top-of-mind for lawmakers nationwide, but too often their needs are more a matter of conjecture rather than actual evidence,” says Sander Daniels, co-founder of Thumbtack.com. “Some 7,000 businesses owners across the country have told us that they care about a lot more than just taxes – for most businesses, simple licensing regulations and helpful training programs are even more important to their success.”
Some of the survey’s key findings include:
- 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 percent more important than taxes in determining a state’s overall business-friendliness, confirming the findings from last year’s study. Furthermore, this year’s research revealed that 40 percent 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 felt they pay about the right share of taxes.
- African-American and Hispanic small business owners were significantly more likely than their white counterparts to encourage others to start a new business.
- North Carolina was the most improved state, making strides across multiple categories and rising from a “C+’” to a “B+” grade overall.
- The ease of obtaining health insurance was an important factor for many businesses. One-third of small business owners rated obtaining and keeping health insurance as “Very Difficult,” versus only 6 percent who rated it “Very Easy.”
“It is critical to the economic health of every city and state to create an entrepreneur-friendly environment,” said Dane Stangler, director of Research and Policy at the Kauffman Foundation. “Policymakers put themselves in the best position to encourage sustainable growth and long-term prosperity by listening to the voices of small business owners themselves.”
The full results can be seen here and include full sets of rankings, dozens of easily searchable quotes from small businesses nationwide, regional comparisons within states, and Census data comparing states’ and cities’ key demographics against those of other states and cities.
“The relative ease of running a business where I live is a direct reflection of the way our city and state operate and enforce the rules. They are very orderly and have very clear laws that are easy to follow. It leaves me with more time to focus on actually running my business.” Trainer – Salt Lake City, UT
Survey methodology
Thumbtack.com surveyed 7,766 small businesses across the United States. The survey asked questions about the friendliness of states and cities toward small business, such as:
- “In general, how would you rate your state’s support of small business owners?”
- “Would you discourage or encourage someone from starting a new business where you live?” and
- “Do you think you pay your fair share of taxes?”
Thumbtack.com and the Kauffman Foundation evaluated states and cities against one another along more than a dozen metrics. The full methodology paper can be found here.
What is Thumbtack.com?
Thumbtack.com is a place where you can hire help locally. Need a DJ, interior designer,wedding photographer, or house cleaner? Tell us what you need, and we’ll bring you 3-5 bids on that job to your email inbox within 24 hours. More than 275,000 small businesses and freelancers have listed their services on Thumbtack nationwide.
Media Contacts:
Barbara Pruitt, 816-932-1288, bpruitt@kauffman.org, Kauffman Foundation
Sander Daniels, 415-547-0579, sander.daniels@thumbtack.com, Thumbtack.com
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