New Hampshire is ranked 35th among states for being the best place to start a business, according to a SimplifyLLC study released this week.
“In a decade of changes in how Americans work, an unprecedented number of entrepreneurs are using remote work and AI capabilities to launch companies from their laptop,” SimplifyLLC said in a news release accompanying the study results. “Less beholden to any particular location, business owners have new factors to consider when deciding where to set up their business.” SimplifyLLC is an independent publication that provides free guides for small business owners.
SimplifyLLC analyzed seven metrics to identify the best and worst states to launch a business in 2024, including job creation, consumer spending, inflation, business growth and performance, corporate taxes, and whether educated workers are more likely to move in or out of the state, according to the report that accompanied the study.
“We found that some states are fostering stronger entrepreneurial environments than others,” the study report said.
New Hampshire is the worst state in the nation for consumer spending growth, according to the study. It is ranked 51st (Washington, D.C. is also included in the rankings). It also isn’t doing wll at job creation, with a rate of 9.2 On the other hand, along with the other New England states, it has the lowest inflation in the U.S.
Of the metrics examined, New Hampshire ranked:
- 29th in new business growth, at 7.1%
- 6th in businesses performing excellently, at 16.2%
- 45th in job creation rate, at 9.2
- 51st in consumer spending growth, at -3.2%
- 33rd in maximum corporate tax rate, at 7.5%
- 1st in inflation since 2021, at 14.3%
- 21st in educated worker net migration, at 3,192
The metrics are explained in the study as:
New business growth is the rate at which new enterprises are being established reflects the entrepreneurial activity and confidence in a state.
Business performance reflects the satisfaction of existing businesses, providing insights into a state’s business environment and outlook.
Job creation is the ability of businesses to create employment opportunities, a direct indicator of economic vitality more broadly. [The rate is measured by economists with a formula that calculates inflow and outflow, among other numbers].
Consumer spending is a key indicator that reflects the confidence and financial well-being of state residents, which will influence the success of local businesses. [This is a formula that measures the amount people pay for goods and services.]
Corporate taxes have a direct impact on businesses’ financial viability, with a lower tax rate considered to be more favorable.
Inflation is different regionally, with an impact on the cost of living and doing business. A higher rate is considered worse for the economic climate. The New England states have had the lowest rates since 2021, while states like Montana, New Mexico and Idaho have seen rates of nearly 20%.
Educated worker mobility illustrates how attractive a state is for skilled professionals, which has an impact on availability of a talented local workforce. The number shown in the bullet points is net gain.
Key findings of the study were:
- Wyoming, the No. 1 state, has no corporate income taxes and has had rapid business growth over the past year (39.2%). About 1 in 5 businesses say their recent performance has been excellent.
- Illinois is the worst state. The study found that Illinois is experiencing an exodus of educated workers (net -54,000 in 2022), has a high corporate tax burden (maximum rate of 9.5%).
- Every State Has Its Pros and Cons. For instance, Hawaii scored 45th because of its poor business performance and job creation over the past year, but it does have some of the best scores in the country when it comes to consumer spending growth (4.7%) and keeping inflation down since 2021 (16.9%).
The study’s report concluded, “While all states offer various opportunities and challenges for entrepreneurs, our findings may upend preconceived ideas about the traditional hubs of American innovation. As the business landscape continues to evolve in 2024, it’s critical for aspiring entrepreneurs and established businesses alike to keep on top of these regional nuances, enabling them to make strategic decisions about where to set up shop or expand their operations amid an ever-changing environment.”
The full study and its methodology can be found here.
NH’s neighbors starting a business rank
Maine, 22
- 22nd in new business growth, at 9.9%
- 5th in businesses performing excellently, at 16.3%
- 18th in job creation rate, at 11.4
- 49th in consumer spending growth, at -1.7%
- 46th in maximum corporate tax rate, at 8.93%
- 1st in inflation since 2021, at 14.3%
- 12th in educated worker net migration, at 9,575
Vermont, 37
- 43rd in new business growth, at 1.7%
- 9th in businesses performing excellently, at 14.7%
- 45th in job creation rate, at 9.2
- 45th in consumer spending growth, at -0.2%
- 43rd in maximum corporate tax rate, at 8.5%
- 1st in inflation since 2021, at 14.3%
- 26th in educated worker net migration, at -549
Massachusetts, 41
- 31st in new business growth, at 5.7%
- 17th in businesses performing excellently, at 13.6%
- 41st in job creation rate, at 9.7
- 46th in consumer spending growth, at -0.9%
- 39th in maximum corporate tax rate, at 8%
- 1st in inflation since 2021, at 14.3%
- 48th in educated worker net migration, at -29,331