Small business owners gave Missouri an overall “B”—the highest grade it’s ever received—in Thumbtack.com’s fourth annual Small Business Friendliness Survey.
More than 18,000 small business owners from around the country responded to the survey, with 293 representing Missouri. Survey respondents graded how well state and local governments supported the livelihood of small businesses in 11 key categories, including tax codes and environmental regulations.
Missouri did its best in the “ease of starting a business” and “health & safety” categories, earning an “A-” for both. The state’s training and networking programs, however, left much to be desired: Small business owners gave Missouri an “F” for that category.
“It would be nice to tap into grant programs to fund advertising or alternately obtain assistance in networking,” a Ballwin computer repair specialist reported in the survey.
It’s easy to start a business, but not staff a business, in Missouri, according to this year’s survey results. Missouri received an “A-” for ease of starting a business, but its “C+” score for ease of hiring indicates an alarming imbalance. Perhaps licensing is to blame: One St. Louis real estate inspector reported in the survey that “the government continues to add more layers of regulation and paper work,” putting an increased stress on businesses.
“We think limiting policy hurdles are really driving entrepreneurship and encouraging people to go out and work for themselves,” said Thumbtack Chief Economist Jon Lieber in an article for the Fulton Sun.
Nationwide, Texas, Utah and New Hampshire edged out Missouri with their “A+” scores for overall business friendliness, while California, Connecticut, Illinois and Rhode Island all received failing grades.
4 billion in annual AGI when they moved to Missouri, according to the map. But even that wasn’t enough to offset the state’s $2.42 billion loss to Florida, its $1.19 billion loss to Texas or its $472.88 million loss to Arizona.
“It’s the Rust Belt moving to the Sun Belt, and I don’t think we’re necessarily alone there,” says State Director Brad Jones. A quick look at the data proves him right: Like Missouri, many of the 23 states that lost wealth saw billions moving to sunny and tax-free Florida and Texas. Florida topped the 50 states with a $127.02 billion gain; Missouri was about average at No. 32 on the list.
The counties that lost the most wealth in Missouri were St. Louis County (-$5.93 billion), Jackson County (-$2.33 billion), and St. Louis City (-$2.19 billion). Attracting the most individual wealth were St. Charles, Christian, and Cass counties, with gains of $2.43 billion, $765.52 million, and $584.77 million, respectively.
Much of that wealth stayed close to home. Of the $5.93 billion lost in St. Louis County, $2.69 billion went to its neighbor, St. Charles County. Similarly, Jackson County saw $518.12 million and $332.15 million go to bordering Cass and Clay counties.
The one-percent Earnings Tax imposed on St. Louis and Kansas City residents could be contributing to that pattern, Jones says. “It’s kind of a death spiral: The businesses and the tax base start to move out, and schools rely on that tax base, so they start failing.” It’s an ill-fated combination that pushes more wealthy residents and small businesses to the nearby suburbs.
“I think there’s still some work that we need to do in Missouri, from a litigation standpoint, that would certainly make us more attractive” to businesses, Jones says.
Here’s how the biggest losers stack up:
1. St. Louis County lost $5.93 billion in annual AGI and lost 64,777 residents
2. Jackson County lost $2.33 billion in annual AGI and lost 23,655 residents
3. St. Louis City lost $2.19 billion in annual AGI and lost 50,591 residents
4. Pulaski County lost $223.61 million in annual AGI and lost 2,243 residents
5. Buchanan County lost $185.28 million in annual AGI and lost 3,339 residents
6. Cole County lost $128.01 million in annual AGI and gained 13 residents
