Here Are the Best (and Worst) States to Start a Business

LOS ANGELES, Sept. 26, 2016 /PRNewswire/ -- In light of the number of new businesses in the U.S. reaching record highs since the financial crisis, GOBankingRates has ranked all 50 U.S. states to find the best and worst states to start a business.

To see how your state stacks up, visit: https://www.gobankingrates.com/personal-finance/10-best-worst-states-entrepreneurs/ 

GOBankingRates analyzed the following factors:

• Startup activity
• Business survival rate
• Productivity
• Availability of employees
• Education level of potential employees
• Business tax climate
• Cost of living

"If you're an entrepreneur, it might pay off to consider launching your latest endeavor in a business-friendly state," said Cameron Huddleston, Life + Money Columnist for GOBankingRates. "Fortunately, you won't be limited to just one geographic region. Our study found that new businesses have a great chance in a range of places across the nation – from Wyoming in the West to Delaware in the East, Florida in the South and Alaska in the far, far North."

Stand-Out Study Insights:

• States located along the once booming "Rust Belt" may be seeing a revival of new business, as Ohio ranked 2^nd for opportunity share of new entrepreneurs.
• While Alaska and Nevada rank worst for education levels, their employee availability and favorable business tax climate scores put them at 2^nd and 3^rd on our list, respectively.
• The rate of new entrepreneurs in states east of the Mississippi River such as Pennsylvania, Rhode Island, Indiana and Delaware are some of the lowest in the nation.
• While Virginia is the ninth-best state to start a business, its neighbor West Virginia ranks the 10^th worst.

Methodology: GOBankingRates considered nine factors to rank all 50 states on the strength of existing small businesses and startups, as well as how favorable the state's business climate is to entrepreneurs. Data was sourced August 2016.

To measure startup activity, GOBankingRates examined three factors: (1) the opportunity share of new entrepreneurs, (2) the rate of new entrepreneurs in a given month, (3) and the density of startup businesses per 1,000 existing businesses. Startup activity data was sourced from The 2016 Kauffman Index: Startup Activity Report on State Trends. To measure business survival rate, data on the ratio of business creations to business deaths (4) was sourced from the U.S. Bureau of Labor Statistics. Productivity (5) was measured by the state's per capita GDP in 2015, sourced from the U.S. Bureau of Economic Analysis. To measure labor force quality, data on the percentage of availability of employees (6) was sourced from DirectEmployers.org, and education level of potential employees (7) from the U.S. Department of Education. For business tax climate (8), rankings were based on a composite index of business taxes sourced from the Tax Foundation. Lastly, the states' cost of living (9) was sourced from the Missouri Economic Research and Information Center.

About GOBankingRates

GOBankingRates.com is a personal finance news and features website dedicated to helping visitors live a richer life. From tips for saving money, to investing for retirement or finding a good interest rate, GOBankingRates helps turn financial goals into milestones and money dreams into realities. Its content is regularly featured on top-tier media outlets including MSN, MONEY, AOL Finance, CBS MoneyWatch, Business Insider, and dozens of others. GOBankingRates specializes in connecting consumers with the financial institutions and products that best match their needs. Start your journey towards a rich mind and full wallet with us here.

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GOBankingRates.com
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SOURCE GOBankingRates

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