The Best -- and Worst -- Small-Business States
Nevada is the No. 1 place to be an entrepreneur, according to a survey that ranks states in terms of being friendly to -- or at least keeping their hands off -- small businesses. The sixth annual report by the Small Business Survival Committee, a business advocacy group headquartered in Washington, D.C., based its ratings on taxes, electricity costs, workers' pay rates, crime, and laws discouraging labor unions.
In descending order, the other top small-business states behind Nevada are: South Dakota, Washington, Wyoming, Florida, Texas, New Hampshire, Alabama, Mississippi, and Tennessee.
States ranked lowest on the SBSC index begin with Vermont, which came in 42nd., followed by New York, California, New Mexico, Minnesota, Kansas, Maine, Hawaii, and Rhode Island. According to the SBSC, the very worst place in the country for small businesses is Washington, D.C.
"In an increasingly mobile and competitive national economy, differences in government-imposed costs of doing business can make a huge difference between whether a state grows economically or falls behind," says SBSC President Darrell McKigney.
Maybe so. But a recent study released by the National Commission on Entrepreneurship and based on U.S. Census data put Utah atop the charts as the destination for high-growth companies. By contrast, the SBSC ranked Utah 34th.
The NCOE data indicates that more than a hands-off policy is needed for small businesses to thrive. Also important are factors like access to intellectual capital, strong computer-technology departments in state universities, and support from economic-development offices staffed by people with strong business backgrounds.
Perhaps a location's recipe for entrepreneurial success needs to be a good mix -- things like minimal red tape, access to tech-savvy workers, and proximity to a few good restaurants.
Here is the complete list of states and their rankings in the Small Business Survival Index 2001:
For a copy of the "Small Business Survival Index 2001," you can visit SBSC's Web site at www.sbsc.org. SBSC is a national nonpartisan, nonprofit small-business advocacy group based in Washington, D.C.
By Robin J. Phillips in New York
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