In its latest research, Harrington Group International looked at several economic and consumer metrics of states in the U.S. and gave each a “z score” to rank them. In its “Best States for Entrepreneurs” report, the business solutions firm ranked Florida number one, followed by Texas and Tennessee.
At the bottom of the list were New York, Illinois and Connecticut.
More from WWD
“The rankings were determined by analyzing myriad factors such as taxes, jobs, the start-up survival rate, consumer spending, net migration of educated workers, and GDP [gross domestic product], among others,” said a spokesperson, who noted the data was compiled from the Bureau of Labor Statistics, the Census Bureau and the Bureau of Economic Analysis data from 2020 to 2022.
Florida was number one overall, with jobs growing by 4.9 percent during that two-year period while 133,518 educated workers migrated into the state, and consumer spending increased by 15.6 percent, the company said.
In its analysis, the authors of the report said the overall business environment “isn’t so bleak at the national level. Employment has risen over the past year, at 4 percent, while more than a third of business owners say their companies are doing better than usual and compared with a decade ago, start-ups are more likely to stay in business, with a five-year survival rate of 50.3 percent.”
The report noted that the states with the highest ratings have above-average growth rates for jobs and GDP, strong consumer spending and influxes of educated workers as well as low levels of corporate and personal income taxes.
“Meanwhile, New York, Illinois and Connecticut ranked last overall for a variety of reasons,” the authors of the report said, noting that Connecticut has below-average job growth “and gets a larger share of its tax revenue from income taxes, while Illinois and New York are both losing educated workers to other states.”
To put the findings into context, researchers at the firm said business leaders “are grappling with a major shift in how — and where — Americans work, live and play, driven by high demand for workers, remote work flexibilities and other social and economic forces.” The report also pointed out that consumers are coming off “a summer marked by rising inflation and gas prices, which pinched Americans’ wallets and kept them away from big purchases.”
Looking ahead, the report’s authors said the economic forecast in the U.S. remains mixed, with unemployment dropping to 3.5 percent, which is the lowest level in 50 years. “There are 10.1 million unfilled jobs in the U.S., which marks an unprecedented 14th straight month above 10 million,” the report stated. “However, this is down 1.1 million from the previous month, which may signify a cooling of the job market as the Fed raises interest rates to curb inflation.”
20 Best States to Succeed in Business (Source: Harrington Group International)