MN Earns “A-” Grade for Small-Biz Friendliness

Meanwhile, the Minneapolis-St. Paul metro area earned a “B+” for small business friendliness in the just-released study, compiled by online service Thumbtack.com in partnership with the Kauffman Foundation.

Overall, Minnesota is pretty good at supporting small business owners, but it’s not easy to hire new employees within the state, according to the results of a just-released study.

The second annual study was compiled by Thumbtack.com, an online service that connects customers with service professionals, in partnership with the Kauffman Foundation, which bills itself as the world’s largest foundation devoted to entrepreneurship. The second-annual small business friendliness study examined survey responses from more than 7,000 small business owners across the country.

The state received an “A-” grade for overall small business friendliness, which examines Minnesota’s support of small business owners. Specifically, state grades are based on how small business owners rate the state government support they’ve received, whether they would discourage or encourage someone from starting a new business where they live, and how difficult or easy it is to start a new business in the state.

Minnesota’s 2013 grade marks an improvement from its “B” grade last year. Minnesota also earned an “A-” for ease of starting a business.

The study noted that two-thirds of Minnesota small business owners surveyed felt they were paying about the right share of taxes.

But Minnesota received a “D+” for ease of hiring—and it was middle of the road for a variety of other metrics.  The state earned a “C+” for regulations; health and safety; employment, labor, and hiring; tax code; and licensing—and it earned a “C” for friendliness of environmental regulations.

Meanwhile, the state received a “B-” for both zoning and training and networking programs. (To see the full results for Minnesota, click here.)

In addition to examining small business friendliness among states, the survey also looked at some major metro areas across the country. Minneapolis-St. Paul earned a “B+” for both overall friendliness and for ease of starting a business. The overall friendliness grade was based on how small business owners rate the local government support they’ve received, whether they would discourage or encourage someone from starting a new business where they live, and how difficult or easy it is to start a new business in the metro area.

Minneapolis-St. Paul grades in all other areas were in the “B” and “C” ranges, with the metro area’s ease of hiring and training and networking programs each receiving the worst grade—a “C-.” (To see the full results for Minneapolis-St. Paul, click here.)

Utah was the top-rated state, although Alabama, Idaho, and New Hampshire also received “A+” grades for overall small business friendliness. Meanwhile, Rhode Island, fared worst; it and Maine both received an “F.”

Minnesota fared better than any of its neighboring states. Although the study didn’t collect data for the Dakotas, Wisconsin earned a “B” and Iowa earned a “B-“ for small business friendliness. (To see a map showing the overall grade for each state, click here.)

The top-rated city was Austin, Texas, and the lowest-rated city was Newark, New Jersey. (To see the overall grade for each of the cities examined, click here.)