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Why the Southwest Is Best for Business

Businesses in Idaho, Texas, and Utah report being happiest for everything from starting a business to hiring and taxes.

Thinking of starting a business? Head to the Sunbelt.

That's where businesses consistently rank the highest for a variety of happiness factors, logged by online services marketplace Thumbtack, in its U.S. Small Business Friendliness survey, released June 10.

Thumbtack, which collaborated on the study with the Ewing Marion Kauffman Foudation, polling 12,000 entrepreneurs around the U.S., found Idaho, Louisiana, Texas, Utah and Virginia ranked at the top of the list with an "A+" score.

The study worked up its scores from a composite of potential attributes, including a state's overall friendliness, ease of starting a business, taxes, licensing, and regulatory concerns, among other things.

According to the report:

Friendliness of professional licensing requirements was the most important regulatory issue in determining a state's overall friendliness to small businesses. Closely following licensing requirements was the ease of filing taxes.

So who ranked the worst? Sorry, Northeast and West Coast. Rhode Island and California got the lowest grades, an "F" followed hard upon by straight "Ds" from Connecticut and New Jersey. (New Hampshire, however, got an "A" for overall friendliness.)

If you're looking for good cities, small business owners in Boise, Idaho, Colorado Springs, Colorado and Houston gave these locales the highest marks. Buffalo, Providence, and Sacramento got the thumbs down from business owners.

And there's always room for improvement: Kentucky, moved to an "A" in 2014, from a "B-" in 2013. Check out the screen shot below and click over for the full interactive infographic.

*Data from Thumbtack





Last updated: Jun 20, 2014

JEREMY QUITTNER | Staff Writer | Staff Writer, Inc. and

Jeremy Quittner is a staff writer for Inc. magazine and He previously covered technology for American Banker and entrepreneurship for BusinessWeek.

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