Updated October 2 at 6:02pm

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small business

R.I. at bottom of small-business friendly states, again


SAN FRANCISCO – Rhode Island finds itself at the bottom of another national ranking, this one for friendliness toward small business. Based on a survey conducted by Thumbtack.com, an online services job board, and the Ewing Marion Kauffman Foundation of 7,766 small businesses, Rhode Island was given an “F,” along with Hawaii and Maine based on answers to questions that included:

  • In general, how would you rate your state’s support of small business owners?

  • Would you discourage or encourage someone from starting a news business where you live?

  • Do you think you pay your fair share of taxes?

One interesting tidbit from survey results: respondents said that professional licensing requirements were 30 percent more important than taxes in determining a state’s overall friendliness to business, an important factor since 40 percent of U.S. small businesses are subject to licensing requirements by multiple jurisdictions or levels of government. In addition, more than half of small business owners felt they pay about the right share of taxes.

Of the 10 factors that played into the state’s overall “F” ranking, Rhode Island’s highest grade was a “C+” for “employment, labor and hiring,” which was generated by the answers to this question, “How unfriendly or friendly is your state or local government with regard to employment, labor and hiring regulations?” The state received a “C” from responses to “Does your state or local government offer helpful training or networking programs for small business owners?”

Other “Fs” were given to the state for “Ease of starting a business,” “Ease of hiring” and “Licensing.”

Despite the poor showing in the 2013 survey, it was a significant improvement on the 2012 results. The Ocean State received “Fs” in seven of nine categories, with a “D+” in “Employment, labor & hiring,” and an “A+” in “Hiring Costs.”

“It is critical to the economic health of every city and state to create an entrepreneur-friendly environment,” said Dane Stangler, director of Research and Policy at the Kauffman Foundation, in a release. “Policymakers put themselves in the best position to encourage sustainable growth and long-term prosperity by listening to the voices of small business owners themselves.”

To view the full report and analysis, click HERE.


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