R.I. voted least friendly state for small businesses

RHODE ISLAND was voted the least friendly state for small businesses in a survey by and the Ewing Marion Kauffman Foundation. For a larger version of this map, click HERE.
Posted 5/9/12

SAN FRANCISCO – Rhode Island was voted the least friendly state for small businesses in a survey by and the Ewing Marion Kauffman Foundation.

The results of the two-month survey, which interviewed more than 6,000 small business owners nationwide, were released Tuesday.

“Six thousand small-business owners have told an unusually nuanced story about what they value in their state or city government,” said Sander Daniels, co-founder of

Rhode Island earned the lowest ranking in the San Francisco-based technology firm’s survey. The Ocean State was one of four states to land itself a failing grade, including Vermont, California and Hawaii. Massachusetts earned a “D” grade.

The small-business owners surveyed gave Rhode Island an “A+” for hiring costs, training programs and networking programs, but those scores weren’t enough to overcome the failing grades the state earned in ease of starting a business, regulations, health & safety, tax codes, licensing, environmental and zoning.

Across the country, Rhode Island ranked 12th for current economic health, but 42nd regarding optimism about the future.

“Entrepreneurs value a lot more than just low tax rates. Easy-to-understand licensing regulations and well-publicized training programs are often overlooked as critical tools necessary to support small business,” said Daniels.

According to the survey, small businesses said licensing requirements were nearly twice as important as tax rates in determining business-friendliness.

“Asking entrepreneurs to rank state friendliness to their businesses is a powerful resource for helping policymakers understand the needs of business owners and for helping aspiring founders understand the full dimensions of their business environment,” said Dane Stangler, director of research at the Kauffman Foundation.

Idaho, Texas, Oklahoma and Utah earned the top four spots on the survey, respectively, with ‘A+’ grades.

For the full results visit,

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RI policy makers have remained deaf to the requests of small business owners these many years.

This information will only serve to hinder economic growth from outside the state and discourage those of us in RI.

The good folks at the state house will no doubt see this as a challenge to their policies and disregard these findings.

Wednesday, May 9, 2012 | Report this
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