Small businesses have generally seen some fairly important improvements over the last few years or so, as the U.S. economy improved. However, there have been some states where these steps forward have been felt more profoundly than others, and that trend certainly continued in 2014.
In terms of states where laws generally benefit small business owners and their companies, the best one in the country this past year was South Dakota, with a score of 35.378 (on this scale, a lower score indicates fewer obstacles for companies), according to the latest Small Business Policy Index from the Small Business and Entrepreneurship Council. This ranking is based on 42 different measures ranging from taxation laws, regulatory controls, and even how the state government spends money.
“Policies clearly affect the environment for investment, entrepreneurship and small business growth,” said SBE Council president and CEO Karen Kerrigan. “In order to compete for capital, business and human capital, many Governors and state legislatures are pushing forward with policies to improve their tax and regulatory climates. This competitive policy environment is a big plus for small business. States like Arizona, Indiana, Kansas, New Mexico, North Carolina, North Dakota, and Ohio have really stepped up their game on the policy front. In each of these cases, tax reform and relief were undertaken, which reduces the costs of risk taking and doing business.”
Which other states were good for small business
Also making the list of states where small businesses may be best positioned to flourish were Nevada, Texas, Wyoming, and Florida, among others, the report said. Only the states in the top three were able to get their ratings to less than 40, and the top five were the only ones to get under 50. North Dakota rounded out the top 10 led by its southern neighbor, with a rating of 63.134.
Meanwhile, California was considered the worst state for small businesses, with a rating of more than 118, the report said. New Jersey and New York ranked 49th and 48th, respectively, while Hawaii, Minnesota, and Vermont were the only other states with scores north of 100.
Owners who want to position themselves and their companies for the most success going forward, regardless of where they’re based, will probably have to shore up their finances. One way to do this may be to cut small business insurance costs, including those for liability insurance, to potentially free up thousands annually.