Ashland Alliance News / July 9, 2014
Thumbtack.com survey ranks the state in top ten in nation for small businesses
ASHLAND, Ky. — Kentucky’s business climate has become one of the nation’s friendliest in recent years, gaining it some valuable exposure in the economic development community.
According to a recent survey by Thumbtack.com, completed in conjunction with the Kauffman Foundation, Kentucky is among the top 10 friendliest states for small businesses. Kentucky was given an A- for Small Business Friendliness by the survey, up from its grade of B- in 2012.
Thumbtack surveyed more than 12,600 small businesses across the country in order to grade states across 11 categories including: overall friendliness, ease of starting a business, ease of hiring, regulations, health and safety, employment, tax code, licensing, environmental, zoning, along with training and networking programs.
“After a two-month survey of thousands of small business owners nationwide, Kentucky’s small businesses have rewarded the Commonwealth with a top ten rating,” said Jon Lieber, Chief Economist of Thumbtack. “Creating a business climate that is welcoming to small, dynamic businesses is more important than ever, and Kentucky has worked hard to make that a reality,” Lieber said, noting “rarely does anyone ask small business owners themselves about what makes for a pro-entrepreneur environment.”
Kentucky received A grades for overall friendliness and ease of hiring along with B grades for the ease of starting a business, employment, and zoning. It received C grades for health and safety, tax code, environmental, and training and networking programs while it scored a D for licensing.
Ashland Alliance officials praised the results of the survey, saying Kentucky’s favorable climate for small businesses will help it not only to retain and grow that essential part of the economy but attract other, larger firms needed as well.
“There are really two or three different groups that we talk too,” said Ashland Alliance Chairman Ed Neely. “One would be a person who wants to start a business and is already here. We have to give them as much support as we can.”
“Second are the businesses that are already here that want to expand. We want them to stay here and expand … so it’s very important that our state and local governments provide them what they need, that we have the workforce that they need and the incentives that they need (to stay),” said Neely.
In fact, small businesses account for more than 99 percent of U.S. firms, employing nearly half of all private sector employees, according to the U.S. Small Business Administration. Over the last two decades nearly two-thirds of net new private sector jobs have been created by small businesses.
“Finally to grow our area, we look for people coming in to Kentucky. Before they ever step on site, they are going to do a lot of research about us. That is why it is very important for positive stories to be out there for them to find… Any type of research or poll that shows Kentucky in a positive light, helps support their research so we get a chance to show them what we have when they come,” said Neely.
The Thumbtack.com survey is just one way the area can “show off our attributes and our assets,” said Neely, “We have a lot of good things here and we have to get the word out.”
“The world is getting smaller every day and everyday we are competing, with everyone everywhere forever. We are competing and business environment is an important decision, for when companies make a decision on what markets they are going to enter into,” added Ashland Alliance President Tim Gibbs.
“Perception is a little bit of reality as well and when you are recognized as being a business friendly environment that is certainly something that is worth sharing,” he said.
“Organizations like the Ashland Alliance are an advocate and they also connect the dots. For us, part of positioning our community is to understand what we’re doing right and what we’re working on. When third party outside sources recognize you for being in the top 20 percent for business climate, that is significant,” Gibbs added, “That is a story worth sharing.”
Gibbs said the Thumbtack survey in only the most recent study to rank Kentucky’s business environment as among the best in the country.
In 2013, Kentucky was ranked 9th by Site Selection Magazine for its business climate, climbing two spots from 2012. The ranking is based on a survey of corporate site selectors as well as a set of criteria that included competitiveness, project activity, and state tax burdens.
Kentucky scored highly in the project activity categories, including first place for number of qualified projects on a per capita basis in 2012 and second place for number of qualified projects on a per capita basis for the first eight months of 2013. Kentucky was 10th overall for project activity in 2012, when population was taken out of consideration. Kentucky has a population of 4.3 million, making it the 26th most populated state in the U.S.