Kentucky is the 4th Best State for Entrepreneurs
Kentucky ranks in the top 5 of the best entrepreneurial climates in the nation according to an annual economic study.
The University of Nebraska-Lincoln’s economics department has produced the State Entrepreneurship Index since 2008 which reports a state-by-state measurement of entrepreneurial activity.
The measurement considers a range of factors including the number of business startups and failures compared to population, new patents and average income.
The SEI combines five factors to formulate the overall state rankings: establishment growth, establishment growth per capita, business formation rates, patents per 1,000 people and income levels for non-farm proprietors.
The report places Kentucky 4th behind New York, California and North Dakota noting a 4.6% increase in business establishments in 2013 and a nearly 13% gain in new patents per 1,000 people.
Last year’s report placed Kentucky at 49th, just above Michigan, but its 45-place rise gives it the biggest positive jump this year.
Gov. Steve Beshear was quick to praise the improvement.
“Small businesses are the backbone of our economy,” said Gov. Beshear. “Over the past several years, this administration has focused on developing innovative programs and offering dynamic services to help these growing companies every step of the way. Even though this is a significant jump, I’m not surprised we’re producing great results. Kentucky is a tremendous place to grow a business.”
Director of the Small Business Development Center at Murray State Chris Wooldridge says the SEI report is a great reflection of the economic growth he’s already seen in our area.
“And I think it’s an accurate reflection of all the work that’s being done in realizing that the success of these businesses and the success of these entrepreneurial efforts really is key to the success and overall health of the state," said Wooldridge. "Obviously, moving from where we were to where we are now is a very good thing. And it’s a good message to the nation that Kentucky is open for business and that we as a state support our business however we can to make sure they’re successful.”
Wooldridge says Kentucky’s improvement is in part attributable to the availability of resources within Kentucky’s network of state and local entrepreneurial offices.
“The Great Recession took a big bite out of a lot of businesses and really slowed down the start up aspect of entrepreneurial activity, although that is starting to pick up and probably since 2009/2010 we’ve seen incremental increase each year in startup interest," said Wooldridge. "Just the commitment and the focus of all of those resources and all of those partners had the best chance of success has just really been incredible these last 3-4 years.”
Both Illinois and Tennessee’s rankings saw a slight drop from last year, now listed at 25th and26th respectively.