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| Small Business Survival Index '05 Released
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October 12, 2005
Washington, D.C.-Today, the Small Business & Entrepreneurship Council (SBE Council) released its tenth annual rankings of the states according to their respective public policy climates for small business and entrepreneurship in the ‘Small Business Survival Index 2005.'
According to SBE Council chief economist Raymond J. Keating, author of the study, ‘The ‘Small Business Survival Index' aims to gauge, state by state, whether public policies help or hurt the entrepreneurial sector of our economy, which of course is so important for economic growth, innovation and job creation.'
SBE Council CEO and President Karen Kerrigan added, ‘Are elected officials and policymakers living up to their rhetoric about how much they support and appreciate small business owners? That's the question to be answered, and we seek to do so with the ‘Small Business Survival Index' each year.'
The ‘Small Business Survival Index' for 2005 has been revised and expanded, including the addition of four measures of health care regulation. Kerrigan noted: ‘Health care costs are a heavy burden on small businesses, and those costs most assuredly are affected by government regulations and mandates.'
The Index now analyzes 26 major government-imposed or government-related costs affecting small businesses and entrepreneurs, including an assortment of taxes and measures that reflect various regulatory costs. These government-imposed or government-related costs are added together to compute an overall rating. The entire report is available at http://www.sbecouncil.org/.
Keating notes: ‘The ‘Small Business Survival Index' allows states to be compared in terms of their tax burdens and many of their regulatory costs. As explained in the study, economic common sense, backed up by a large body of economic literature, makes clear that these policies matter a great deal to entrepreneurs, businesses, employees and overall economic health.'
In terms of their policy environments, the most entrepreneur-friendly states under the ‘Small Business Survival Index 2005' are: 1) South Dakota, 2) Nevada, 3) Wyoming, 4) Washington, 5) Michigan, 6) Florida, 7) Mississippi, 8) Alabama, 9) Indiana, 10) Colorado, 11) Texas, 12) South Carolina, 13) Virginia, 14) Pennsylvania, and 15) Tennessee. In contrast, the most anti-entrepreneur policy environments are offered by the following: 37) Oregon, 38) Montana, 39) North Carolina, 40) Ohio, 41) Iowa, 42) Massachusetts, 43) Vermont, 44) New York, 45) New Jersey, 46) Hawaii, 47) Minnesota, 48) Rhode Island, 49) Maine, 50) California and 51) District of Columbia. Complete rankings are found below.
Keating added: ‘Obviously, there are virtually infinite factors impacting economic decision-making. Does the ‘Small Business Survival Index' tell us something valuable about the economy? Very much so. In addition to the various studies cited in the report noting how the various measures included in the Index impact the economy, it's also worth noting some other facts. For example, from 2000 to 2004, the 25 best ranked states on the Index experienced population growth that was 56% faster than the worst 25 states plus the District of Columbia. Equally interesting is net domestic or internal migration, that is, movement of people between the states. From 2000 to 2004, the top 25 states on the Small Business Survival Index netted a 1.64 million increase in population at the expense of the bottom 25 states plus the District. For good measure, employment growth was much faster among the top 25 states versus the bottom 25 plus D.C.'
For a copy of the ‘Small Business Survival Index 2005,' visit SBE Council's website at http://www.sbecouncil.org/. SBE Council is a national nonpartisan, nonprofit small business advocacy group headquartered in Washington, D.C.
Following are the complete state rankings for the ‘Small Business Survival Index 2005':
Small Business Survival Index 2005: State Rankings
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