Massachusetts Among Least Friendly for Small Businesses

By CHARLENE ARSENAULT (Patch Staff)

If you’re thinking about opening up a small business in Massachusetts, you may want to reconsider another state, according to a recent survey.

Small businesses found Massachusetts to be one of the least friendly states for microenterprise, according to Thumbtack’s annual Small Business Friendliness Survey.

Nearly 18,000 U.S. small business owners responded to the survey, including 463 in Massachusetts.

The business owners were asked to rate their state and city governments across a broad range of policy factors, including licensing and tax regulations.

“Small business owners on Thumbtack have consistently told us that they welcome support from their governments but are frequently frustrated by unnecessary bureaucratic obstacles,” said Jon Lieber, chief economist of Thumbtack, in a statement. “Massachusetts does a great job for fast-growing innovative businesses, but for small businesses, the burdens of getting up and running are just too high.”

“Massachusetts, by and large, is a difficult state to deal with,” commented a dog trainer in Lawrence in an announcement. “This is why people move to New Hampshire.”

The Thumbtack found that Massachusetts performed about evenly with 2014, when it ranked 31 and also got a D-plus. At best, Massachusetts got a C-plus for ease of hiring. And Worcester performed well this year, earning a B-minus overall, with Boston coming in right behind with a C. Massachusetts’ worst scores were F grades for both licensing and tax regulations. The top-ranked states for business friendliness were Texas, New Hampshire, Utah, Louisiana and Colorado. Ranked worse, in order, were Rhode Island, Illinois, Connecticut, California and New York.

In the survey answers, business owners found that ease of compliance with licensing rules mattered far more than tax rates. For example, labor rules were 88 percent more important to business owners than tax rates. Other opinions that emerged from the survey were that effective licensing was just as friendly as no licensing, training experience was a top factor, and high quality websites matter.

Read the full report and results >>>

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