North Carolina is a Great Destination for Startup Businesses
The state of North Carolina has been named as the best state in the country to start a new business in the 2017 ranking which was conducted by FitSmallBusiness.com. The strong showing in the labor market and taxes makes the state an ideal environment for starting business owners, making the state top the list.
According to FitSmallBusiness.com, North Carolina has high rankings in corporate and unemployment insurance taxes as its labor market flourishes. The state also grabbed 6th place in location desirability all over the country.
In order to create this ranking, Fit Small Business analyzed data gathered from Bureau of Labor Statistics, the Small Business Administration and the Missouri Economic Research and Information Center. The ranking chose seven categories which significantly influences the chances for survival and success of an entrepreneur which are listed as follows:
1. The access to capital such as venture capital and small business loans.
2. The rate of new entrepreneurs and the possibility of a business to survive. The startup activity which is a category that takes the rate of entrepreneurs and survivability of business also ranked highly in North Carolina.
3. The taxes surrounding the business, namely: corporate tax, individual income tax, sales tax, unemployment insurance tax, and property tax.
North Carolina’s 3 percent corporate tax rate is the lowest of any state levying a corporate tax. This rate is set to be further reduced to 2.5 percent beginning the year of 2019, according to the Tax Foundation. This is pursuant to the North Carolina General Assembly’s latest budget.
4. The cost of living in the area, including grocery expenses, housing, utilities, transportation, and health expenses.
5. The location desirability and labor market.
6. The accessibility of healthcare, education, and physical safety
7. The cost of starting the business, including per capita income and rent for commercial spaces.
It is important to note that the information gathered from the Bureau of Economic Analysis reveals that North Carolina’s 2016 per capita income of $42,000 falls behind the national average of $49,571.
The declaration of North Carolina as number one on the list of best places for starting a business indicates thriving business and a great sign for would-be entrepreneurs. It is because of this that more and more outside job seekers will be finding themselves lured to the state of North Carolina which will only continue boosting the state’s economy.
The final results of the study conducted by Fit Small Business indicates that the other states which were also at the top ranking of the best state for starting a business were:
Although North Carolina placed at the top of the list, South Carolina on the other hand, ranked at the bottom. It was placed at number 48 out of the 50 states which were named on the list. The other states to rank at the bottom of the list were:
47. New Jersey
49. New Mexico
50. Rhode Island
Meanwhile, the City of Raleigh was named the best city in the state of North Carolina to start a business. One possible explanation for this is the prevalent number of resources and academic research derived from some of Raleigh’s major universities. The educated population surrounding Raleigh in conjunction with its high-quality research facilities definitely help the city earn the top spot among all the cities statewide for starting a business. The study also found that more than 40 percent of 25-year olds and over in Raleigh were at least a four-year degree holder as compared to just over one-third of the Americans on a national level.
Studies such as these by Fit Small Business are conducted to help small business owners make wiser decisions before starting a business. Choosing the best state to start a business plays an important role in defining the success and failure of a business. The differences in tax environments, labor pools, cost of living and other economic and social factors are key turning points in defining the success or failure of a business. Thus, choosing the right state to start a business should be one of the primary focuses of business owners alike before they start their journeys.