SBE Council Ranks the 50 States in “Small Business Policy Index 2013”

The Small Business & Entrepreneurship Council (SBE Council) released its 18th annual “Small Business Policy Index 2013: Ranking the States on Policy Measures and Costs Impacting Small Business and Entrepreneurship.”


SBE Council has published the state Index for 18 years, which ranks the 50 states according to 47 different policy measures, including a wide array of tax, regulatory and government spending measurements.

The states that have the most entrepreneur-friendly policies under the “Small Business Policy Index 2013” are: 1) South Dakota, 2) Nevada, 3) Texas, 4) Wyoming, 5) Florida, 6) Washington, 7) Alabama, 8) Indiana, 9) Ohio, 10) Utah, 11) Michigan, 12) North Dakota, 13) Arizona, 14) Colorado, and 15) Virginia.

In contrast, the states with the least friendly policy environments for small businesses are: 40) Rhode Island, 41) Connecticut, 42) Oregon, 43) Iowa, 44) Maine, 45) Minnesota, 46) Hawaii, 47) New York, 48) Vermont, 49) New Jersey, and 50) California.

SBE Council president and CEO Karen Kerrigan said: “Policy reforms that bolster small business startup and growth are mostly being implemented at the state level.  Unfortunately, federal policy and uncertainty remains an overall negative for entrepreneurs and small businesses. But states vary widely in terms of their policy approaches. The top states on the Small Business Policy Index 2013 are streamlining government and lifting burdens like excessive taxation and regulation. They are passing responsible budgets, and living within their means. The worst ranked states keep treating small businesses and entrepreneurs as piggy banks to fund higher spending and bankrupt programs.”

Kerrigan added: “Governors and state leaders who are serious about improving their entrepreneurial ecosystems are aggressively working to change policies that are harming entrepreneurship and business growth.   The White House needs to closely examine what the most successful states are doing to help entrepreneurs.  These pro-growth policies, if enacted at the federallevel, would make a major difference for U.S. economic growth and competitiveness.”

Raymond J. Keating, SBE Council’s chief economist and author of the study, pointed out, “This study is straightforward and well documented. The Small Business Policy Index 2013 is built on sound, clear-cut economics, as understood in Economics 101 and evidenced by the many studies cited in the Index. Quite simply, the states are compared and ranked according to how state and local government policies impact costs and incentives for entrepreneurship and investment. In turn, such risk taking is critical to economic growth, income growth and job creation.”

Keating added, “Small business owners and business leaders need to look at the details for their respective states.  The Small Business Policy Index 2013 is a valuable tool to let policymakers know where improvements are needed, so that entrepreneurs can do what they do best, that is, start up and build businesses, innovate, grow the state’s economy, and create jobs.”

Small Business Policy Index 2013

Rank            State                                    SBPI

1            South Dakota                      34.627

2            Nevada                                 37.537

3            Texas                                    39.520

4            Wyoming                            44.414

5            Florida                                 48.863

6            Washington                       54.500

7            Alabama                              57.758

8            Indiana                                58.138

9            Ohio                                      61.372

10            Utah                                    62.740

11            Michigan                            62.782

12            North Dakota                    63.490

13            Arizona                               64.590

14            Colorado                             65.500

15            Virginia                              65.538

16            Mississippi                        66.713

17            South Carolina                 66.808

18            Tennessee                         68.081

19            New Hampshire              68.789

20            Alaska                               69.487

21            Louisiana                          70.051

22            Georgia                              70.307

23            Kansas                               71.645

24            Oklahoma                        73.392

25            Pennsylvania                   73.685

26            Missouri                            73.703

27            New Mexico                     76.799

28            West Virginia                  79.011

29            Wisconsin                        80.024

30            Kentucky                          80.061

31            North Carolina               80.777

32            Idaho                                80.782

33            Montana                          81.169

34            Delaware                         81.452

35            Illinois                             83.047

36            Arkansas                         83.462

37            Maryland                         84.491

38            Massachusetts               86.408

39            Nebraska                         88.476

40            Rhode Island                 94.255

41            Connecticut                     94.632

42            Oregon                             94.952

43            Iowa                                  97.002

44            Maine                               103.264

45            Minnesota                       103.486

46            Hawaii                             107.070

47            New York                        107.213

48            Vermont                          107.221

49            New Jersey                     109.265

50            California                       113.637

SBE Council is a nonpartisan, nonprofit advocacy, research and education group that works to protect small business and promote entrepreneurship.  For more information, please visit:

Source: SBE Council

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