How Entrepreneur-Friendly Is Your State?
What do South Dakota, Nevada, Texas, Wyoming, and Florida share in common? Certainly not size, geographic region, or climate. Rather, they are, in order, the most entrepreneur-friendly states in the country, according to a new report from the Small Business & Entrepreneurship Council. The SBE Council's U.S. Business Policy Index 2012 ranks the 50 states according to 46 different policy measures, including a wide array of tax, regulatory and government spending measures. California is ranked the least entrepreneur-friendly state, followed by New Jersey, Vermont, New York, Hawaii, and Maine.
Says SBE Council president and CEO Karen Kerrigan:
With all of the focus on federal policy in recent times, it is important to remember that policies at the state level have a major effect on entrepreneurs and businesses for better or for worse. Many governors understand that a friendly policy environment is critical to attracting investment and business, and they are working to improve key policies that will help drive job growth, entrepreneurship and economic opportunity. Small businesses are benefitting from policy competition between the states, and it is encouraging to see leadership on key issues such as fiscal reform, sensible spending, and tax and regulatory relief. The difference in policy costs from state to state can be quite striking, and that matters for entrepreneurship and for a state’s economy.
The National Chamber Foundation's Enterprising States 2012 report strikes a similar chord:
In the ebb and flow of the global economy, states can no longer rely solely on strategies of keeping costs low and providing incentives to attract footloose, commodity-based branch plants or offices. Instead, states must create the right business climate that allows companies and entrepreneurs to create 21st century jobs ... Innovation, now the essential driving force for creating and sustaining economic opportunities, is much more multidisciplinary and global in scope than ever before. Innovation and market cycle times are much shorter and continue to accelerate. This makes it more important than ever that states provide the tools, support, and tax and regulatory environments for companies to continuously innovate without onerous delays and burdensome costs that put their entrepreneurs and businesses at a competitive disadvantage.