While California’s large size and large population may leave the state with an abundance of small cities, WalletHub’s 2018 Best & Worst Small Cities to Start a Business report did not favor the state.
With over 1,250 small cities ranked, only one California city was in the top 300—Twentynine Palms came in at 297. The other high ranking California small cities are Eureka at 347, Paramount at 453, Banning at 472, San Marcos at 480, Coachella at 490, Bell at 499, San Luis Obispo at 502, Azusa at 533, Redding at 556, Chico at 579, South San Francisco at 590, Wasco at 611, South Gate at 622, Atascadero at 632, Pico Rivera at 635, San Pablo at 646, Compton at 650, Santa Paula at 655, San Leandro at 659, Merced at 669, Lynwood at 677, West Sacramento at 685, Lawndale at 688, Beaumont at 690 and Carson at 696., while Folsom, Citrus Heights, and Vacaville Suisun City, Eastvale, and Saratoga are at the verycloser to the bottom of the report.
NFIB California State Director John Kabateck was not surprised by the low rankings, according to Capital Public Radio.
“Some of the advantages in California—we have amazing weather, we have promising educational institutions and a rich and diverse melting pot of people with various backgrounds and gifts,” Kabateck is quoted as saying. “But even those wonderful gems are just simply not enough to keep many here or at least in business on Main Street.”
Kabateck cited California’s labor rules, markets, regulations, and high corporate taxes as reasons why entrepreneurs are not flocking to California.
The report also had several specific other categories that it used to list the best and worst small cities. California dominated the most expensive office space category with six different California small cities vying for the top spot on making the list: Cupertino, West Hollywood, Beverly Hills, Menlo Park, Foster City, and Mountain View.
California also had several cities round out the list of out the lowest average revenue per business with Hacienda Heights, Suisun City, and Imperial Beach. Although California generally ranked low on the report, the state’s small cities did take rank three out of the top five spots in the highest human-resource availability list with El Centro, Calexico, and Brawley.
Analysts with the Public Policy Institute of California told the Capital Public Radio that “a state’s weather, population density, and industry mix—demonstrate a stronger relationship with economic growth than the measures included even in the tax-and-cost-focused indexes. … Still, our findings imply that a better business climate would promote faster economic growth in California.”
