CT Drops in State Rankings of Startup Business Activity, Now 35th in US
/Connecticut dropped from number 27 a year ago to number 35 in the nation in business start-up activity, according to annual rankings developed by the Kauffman Foundation. The drop of 8 positions was among the six worst among the 50 states, the analysis indicated. Only New Hampshire, Missouri and California plummeted further, each dropping nine positions in the annual rankings.
Nationally, the U.S. economy reversed a five-year downward trend in startup activity last year with a big jump in the number of new entrepreneurs - the largest year-over-year growth in two decades, according to the analysis. New business creation increased in 32 states. Connecticut was not among them.
The largest leaps forward came in South Carolina, jumping from 46th to 29th, Oklahoma, from 31st to 16th and Nevada, from 21st to 10th in the 2015 rankings, based on 2014 data. Three components were used to make up the rankings: the rate of new entrepreneurs, the opportunity share of new entrepreneurs and startup density.
The top ranked states were Montana, Wyoming, North Dakota, Colorado, Vermont, South Dakota, Alaska, Idaho, Florida, Nevada and New York.
Connecticut dropped in two of the three key measures of startup activity used by Kaufman in the analysis. The “Opportunity Share of New Entrepreneurs” fell from 76.9% to 74.9%. The stat is described as “the percent of new entrepreneurs starting businesses because they saw market opportunities.” The “Rate of New Entrepreneurs” fell from .31% to .29%. That measure is the percent of the adult population that became entrepreneurs in a given month.
The final measure in the Kauffman formula, Startup Density, saw a slight uptick for Connecticut. The stat consists of the number of startup firms per 100,000 residents, defined as firms less than one year old employing at least one person besides the owner. Connecticut moved from 105.3 in the previous year to 110.4.
For the past 10 years, the Kauffman Index has been "a trusted, early indicator for entrepreneurship in the United States," used by entrepreneurs and policy makers, from the federal to state and local levels.
