The 5 Best and Worst Cities for Small Businesses, According to Small-Business Owners

In a new survey that rates 82 cities in 38 states, Colorado Springs is on top, while Sacramento is at the bottom.

National Journal
July 1, 2014, 5 a.m.

Small-busi­ness own­ers in Col­or­ado Springs really like be­ing small-busi­ness own­ers right where they are.

There are a num­ber of sur­veys that use state and fed­er­al data to de­term­ine how good places are for small busi­nesses. But a new sur­vey re­leased Tues­day asks small-busi­ness own­ers what they think of their ho­met­owns.

San Fran­cisco-based con­sumer-ser­vice web­site Thumb­tack con­duc­ted the sur­vey with 12,000 small-busi­ness own­ers and op­er­at­ors in 82 cit­ies from 38 states. Alaska, Arkan­sas, Delaware, Hawaii, Maine, Mis­sis­sippi, Montana, North Dakota, South Dakota, West Vir­gin­ia, Wyom­ing, and Ver­mont were not in­cluded be­cause of a lack of sur­vey re­sponse.

Since this is a sur­vey, the res­ults are sub­ject­ive and are not based on fed­er­al or state eco­nom­ic data. This is the per­cep­tion of busi­nesspeople in the area who are mem­bers of Thumb­tack, which shows an im­port­ant as­pect of loc­al busi­ness cul­ture. The rank­ings cov­er the met­ro­pol­it­an area, not just the city prop­er.

Here are three of the sev­er­al dozen ques­tions asked:

  • “In gen­er­al, how would you rate your state’s sup­port of small-busi­ness own­ers?”
  • “Would you dis­cour­age or en­cour­age someone from start­ing a new busi­ness in your state?” and
  • “Do you think you pay your fair share of taxes?”

Col­or­ado Springs, Colo., the highest-ranked city in the sur­vey, has the friend­li­est li­cens­ing rules in the coun­try. Small-busi­ness own­ers from there were also the third hap­pi­est in the coun­try in terms of the tax bur­den. Coupled with eight “A+” grades and three “A” grades, it led to the top rat­ing in the coun­try.

The full map shows that most cit­ies in tra­di­tion­ally red states get bet­ter rank­ings from small-busi­ness own­ers, with ex­cep­tions in Min­neapol­is (ranked 11th) and Wash­ing­ton, D.C. (ranked 18th), among oth­er places. Thumb­tack de­scribes it­self as non­par­tis­an. Here are the cit­ies that are friend­li­est to small busi­nesses, ac­cord­ing to those small-busi­ness own­ers.

Top Cit­ies

1) Col­or­ado Springs, Colo. 2) Boise, Idaho 3) Hou­s­ton, Texas 4) Aus­tin, Texas 5) Louis­ville, Ky.

Round­ing out the top 10 are Dal­las, Texas; Fort Worth, Texas; San Ant­o­nio, Texas; Nashville, Tenn.; and Rich­mond, Va.

Bot­tom Cit­ies

82) Sac­ra­mento, Cal­if. 81) Provid­ence, R.I. 80) Buf­falo, N.Y. 79) Bridge­port, Conn. 78) San Diego, Cal­if.

The next five bot­tom cit­ies are Worcester, Mass.; Oxnard, Cal­if.; Ne­wark, N.J.; Los Angeles, Cal­if.; and Pitt­s­burgh, Penn.

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