Survey Ranks Maine 40th Business Friendly State


Small Business

Well, at least we’re not dead last.

survey of 8,000 small businesses across the country published by on the regulatory, tax and economic climate of all 50 states has placed Maine 40th in terms of the state’s friendliness to small business.

If that sounds like progress since Forbes published a similar study placing Maine 50th, guess again.

According to the survey, nine states were excluded from the review because less than 20 businesses from those states responded to the survey. Only Rhode Island’s business climate ranked less friendly than Maine’s.

Utah, Alabama and New Hampshire took home the 1, 2 and 3 spots, respectively.

But despite Maine’s nationwide recognition as perhaps the worst state to do business in, lawmakers are intent on tightening the screws on businesses that are already struggling to survive under the state’s tax and regulatory leviathan.

Read the report from

When it comes to how business-friendly an area is, smaller companies care about much more than just taxes.

A new survey of nearly 8,000 small businesses throughout the country rates business climates of states and metro areas, providing clues to what these economic engines view as top concerns.

Utah earned the highest overall small-business friendly rating of any state, followed by Alabama, New Hampshire and Idaho. Rounding out the bottom of the list, which did not include nine states with insufficient numbers of respondents, were Rhode Island, Maine and Hawaii.

Thumbtack, an online marketplace for businesses, surveyed its clients and partnered with the Kansas City-based Ewing Marion Kauffman Foundation for the report.

Training and networking programs were found to be the best predictor of overall scores, followed by a state’s economy and licensing requirements. Professional licensing — a source of frustration for many business owners — was 30 percent more important than tax codes in determining business-friendliness, the study reported.

In fact, the majority of businesses surveyed didn’t think their taxes were unfairly high. The larger the business, though, the more negatively it perceived its tax rates.

[Related: Maine Business InsideOut–Understanding Maine’s Business Climate (pdf)]

Nathan Allen, who co-authored the report, said licensing requirements stood out as an important factor in a state’s overall business-friendliness. More than half of companies surveyed reported being subject to at least one licensing agency, and many of them must adhere to mandates set by multiple levels of government.

“It’s something they really have to contend with and stay up on,” Allen said. “The time they have to spend on it can become a serious burden to their growth.”



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  1. In re taxes, a number of studies concluded that business investments were affected more by taxation trends than by any particular cut or special tax allowances and breaks. That is, long-run expectations affect long-term investments. That would seem to make sense.


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