There Must Be Something in the Water

Mid-Atlantic and Gulf Coast States Offer the Best Business Climate for Black Entrepreneurs

These Are the Top States for Black Entrepreneurs in 2023

ORANGE, Calif., Feb. 22, 2023 /PRNewswire/ -- As Northerners shake off the last effects of Winter, many are planning Spring trips to the mid-Atlantic or the Gulf Coast. If any of those potential vacationers are aspiring Black entrepreneurs, they might want to consider permanently relocating. Besides warm weather, the two regions offer a great business climate for business owners, according to MerchantMaverick.com's annual ranking of "The Top States for Black-Owned Businesses in 2023" report. The full study is available HERE:

MerchantMaverick.com, the business product comparison site for business owners, discovered some intriguing regional differences corresponding to the warm Atlantic current. Mid-Atlantic states continue to be a haven for Black entrepreneurs. Maryland, Virginia and North Carolina rank at 1, 4 and 9 respectively on the state list. And, each of these state's governments have made a concentrated effort to nurture Black-owned businesses within its borders.

The Gulf Coast doesn't only share Atlantic waters, it also boasts an enticing business climate. Of the five states in that region, Louisiana, Texas and Florida, all made the top ten, appearing at #6, #8 and #10, respectively. The other two states, Alabama and Mississippi, were ranked #10 and #12 on last year's list, demonstrating that they have a generally positive environment for Black-owned businesses.

This is not to imply that Black entrepreneurs do not still face real difficulties. For example, while there was an overall decline in venture capital funding of 36 percent, VC funds for black business owners dropped 45 percent.

Key Findings

• The Mid-Atlantic remains a popular region for Black entrepreneurs. This is due, in part, to a proportionally large Black population, which would tend to reduce barriers to the success of a new business.
• Louisiana and Florida both climbed dramatically in the rankings, rising 14 and 16 spots respectively. This rise, along with the strong showing of nearby states, raised the profile of the Gulf Coast for Black-owned businesses.
• Northern states continue to underperform. Ohio was the most highly ranked state, and only came in at number 12. New York, which has the highest number of Black-owned businesses, barely avoided the bottom half of the list at number 23.
• Many of the trends appearing in the report may be due to hidden factors. For example, Gulf states: Florida and Texas, both of which saw a big jump in population, are performing very well.

THE TOP 10 STATES FOR BLACK ENTREPRENEURS IN 2023:

#1. Maryland

#2. Tennessee

#3. Nevada

#4. Virginia

#5. Georgia

#6. Louisiana

#7. Indiana

#8. Texas

#9. North Carolina

#10. Florida

Methodology

Researchers analyzed data from sources including the U.S. Census Bureau's 2021 Annual Business Survey, the US Census Bureau's 2019 5-year American Community Survey, the US Bureau of Economic Analysis, the US Bureau of Labor Statistics, and taxfoundation.org - to bring you this list. To best determine the best states for Black entrepreneurs, the researchers selected and weighted the following metrics:

These four metrics equally accounted for 75% of the overall score:

• Black-owned employer businesses per capita
• Percent of the workforce employed by Black-owned businesses
• Average annual payroll of Black-owned businesses
• Average annual income of Black business owners

And the next three metrics equally accounted for 25% of the overall score:

• Cost-of-living
• Unemployment rate
• State income rate

"It's hard to draw a single conclusion from a study juggling so many factors," says Chris Motola, Special Projects Editor, MerchantMaverick.com. "But there must be something special about a warm Atlantic breeze."

About MerchantMaverick.com:
With more than 700,000 page views per month, MerchantMaverick.com is an online publication devoted to providing business owners with accurate, unbiased reviews for their businesses. The company's goal is to provide the most honest, accurate, and useful reviews of business products and services to empower entrepreneurs with businesses of all sizes.

For more information on this list and this topic, please contact Sarah Johnson, [email protected].

SOURCE MerchantMaverick.com