Small Business & Entrepreneurship (SBE) Council released the 20th edition of its annual Small Business Policy Index, “Small Business Policy Index 2016: Ranking the States on Policy Measures and Costs Impacting Entrepreneurship and Small Business Growth.”
The Index ranks all 50 states according to various major government-imposed or government-related costs that have direct or indirect impact on entrepreneurship and business, as well as on start-ups and small growth eager companies.
The Index investigates in total 50 measures, from which:
- 25 are tax related,
- 18 relate to rules and regulations,
- 5 focus on government spending and debt issues, and
- 2 remaining measures deal with the effectiveness of important government undertakings.
The outcome is accessible through an interactive map displaying states’ ranking in color, with a summary per state provided after selecting a state.
The most policy-friendly states to entrepreneurs under the “Small Business Policy Index 2016” are: 1) Nevada, 2) Texas, 3) South Dakota, 4) Wyoming, 5) Florida, 6) Washington, 7) Alabama, 8) Arizona, 9) Ohio, 10) Indiana, 11) Colorado, 12) Michigan, 13) Utah, 14) North Dakota, and 15) Virginia.
On the other side of the ranking we can find: 40) Maryland, 41) Maine, 42) Iowa, 43) Oregon, 44) Connecticut, 45) Vermont, 46) Hawaii, 47) Minnesota, 48) New York, 49) New Jersey, and 50) California.
The authors highlight several findings from the report, which are especially interesting to note:
- Average real annual economic growth of the top 25 states’ was by 29.2 % faster than the average rate for the bottom 25 states.
- Also, the top 25 states’ average state population growth of 4.9 percent from 2010 to 2015 was double compared to only 2.5 percent for the bottom 25 states.
- The top 25 states also witnessed positive net domestic migration of a 2.00 million at the expense of the bottom 25 states, which lost 2.03 million people.
The SBE Council President and CEO Karen Kerrigan provides her explanation of the founded facts: “Policy matters for entrepreneurship and small business growth. Quite simply, when elected officials impose weighty tax and regulatory burdens, the increased costs and uncertainties mean reduced risk taking and less economic opportunity. The message from our ‘Small Business Policy Index’ to state officials is clear: If you are serious about helping small business, then reduce barriers to entrepreneurship and government costs imposed on small business.”
To access the Small Business Policy Index 2016 full report please click here.