Report shows Arizona, Phoenix lags in small business startups

A recent study published by The Kauffman Foundation, a Missouri-based non-profit that studies small-business activity, has ranked Arizona 49th in the nation in terms of the number of small businesses being formed. The City of Phoenix was also 37th among the nation's 40 largest metro markets based on a mix of two key measures, including the U.S. Census Bureau estimates for the share of adults owning small companies and the revamped Kauffman Index.

"We do know that Arizona is somewhat of a transient small business population just because we're all from somewhere else," said Rick Murray, CEO of the Arizona Small Business Association. Murray attributed small startup efforts to overly thin cash resources available to entrepreneurs. 

According to the report, the overall rate of small-business ownership has been essentially flat in Phoenix since at least 2008, although about 6.2 percent of adults own their own business, ranking 15th among the largest markets and higher than the 6 percent seen at all levels nationally. Only Las Vegas and Riverside, Calif., had fewer small companies per 100,000 residents. And while this news may seem unfortunate for the state, the problem is more widespread than Arizona.

"Despite the recent year's improvement, long-term trends for the nation are discouraging," reads the report. "The Rate of Business Owners — the percentage of the adult population that owns a business — has been on a downward trend since 1996, the first year we measured it in our data series, despite the small uptick in the latest year."

Starting a business can be tough—that's why it pays to have the Arizona business attorneys of The Law Offices of Donald W. Hudspeth, P.C. on your side. Call us today to find out how we can help get your business off the ground. 

Categorised in: Arizona LLCs, Business Law, C-Corporations & S-Corporations

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