Thursday, April 4, 2013

Survey: RI gets F grade for its friendliness to small businesses ...

shoppers_frog_toad_prov_2012When Twitter and Square co-founder Jack Dorsey appeared on Executive Suite recently, he said the best thing Rhode Island leaders could do to attract more entrepreneurs is to be hospitable to them.

?I think the biggest thing is stating that you want that, stating that you want small businesses, that you want more of them ? and not just stating it but showing it,? the billionaire entrepreneur said.

Dorsey argued that ?easy paths of starting something? are key. ?It?s just taking on that attitude and really showing, not telling, more than anything else,? he said.

Unfortunately, by that standard it seems Rhode Island could hardly be doing worse.

Rhode Island receives a grade of F -?the worst in the country ? for its overall friendless toward small businesses in a new survey conducted by Thumbtack and the Kauffman Foundation. Only two other states ? Hawaii and Maine ? got a failing grade. By comparison, New Hampshire got an A+, Massachusetts got a C- and Connecticut got a D+. (Vermont?s sample size was too small to grade.)

Rhode Island?s defenders may wonder if the survey was put together to make blue states look bad, but its designers emphasized that they were looking for a nuanced picture. (This PDF details the methodology.)

?Many business indices are produced by organizations promoting a particular agenda or policy, such as lower taxes or deregulation,? Nathan Allen and Sanders Daniels of Thumbtack wrote in a summary. ?Our purpose is to accurately convey the attitudes and concerns of actual small business owners.?

A closer look at Rhode Island?s letter grades across 10 subcategories gives a better sense of what policies garner the least support from small businesses:

  • Ease of starting a business: F
  • Ease of hiring: F
  • Regulations overall: D
  • Health/safety regulations: D
  • Employment/labor/hiring regulations: C+
  • Tax code/regulations: D+
  • Licensing regulations: F
  • Environmental regulations: D+
  • Zoning: D
  • Training and networking programs: C

Based on this survey, taxes and regulations are ? unsurprisingly perhaps ? a big complaint from Rhode Island small business owners. (This suggests the Chafee administration was right to bring on Leslie Taito and push for quick action by the new Office of Regulatory Reform.) Moreover, the bright spots for Rhode Island in last year?s survey ? hiring costs, training programs and networking initiatives ? are no longer so bright.

The Thumbtack/Kauffman survey also included a few quotes from survey respondents in Rhode Island:

Personal chef, Providence: ?Rhode Island is attempting to start to help small business but just recently. They are behind the eight-ball considering the bad shape that RI?s economy is in. I am starting to see a turnaround and I hope it continues. It will take both the small businesses and the state and local governments to get the momentum to move in the direction it needs to.?

Fitness trainer, Providence: ?Too many desperate agencies and too hard to coordinate between them, and they?re extremely unresponsive, unhelpful, almost hostile. Too many cumbersome regulations (lead, fire code, [Americans with Disabilities Act], etc).?

Pet hotel owner, North Providence: ?Getting the correct zoning is a problem and parking is terrible.?

Production company owner, Cranston: ?There are high taxes & it?s very hard to turn a profit.?

Home supply retailer, Warwick: ?It has been difficult mainly because of the down economy and my state being one of the most ?business unfriendly? states in the country.?

As Slate?s Matt Yglesias wrote earlier this year: ?Red tape, long lines, inconvenient office hours, and other logistical hassles probably won?t stop tomorrow?s super-genius from launching the next great billion-dollar company. But it?s a large and needless deterrent to the formation of the humble workaday firms that for many people are a path to autonomy and prosperity.?

Thumbtack.com said the Small Business Friendliness Survey was conducted by polling 7,766 respondents nationwide between Oct. 25, 2012, to Jan. 2, 2013. The group told WPRI.com 24 Rhode Island businesses participated in the survey.

? Related: Executive Suite ? What?s wrong with Providence and how to fix it (Jan. 27)

Tags: business, business climate, economic development, economy, entrepreneurs, jack dorsey, small business

Source: http://blogs.wpri.com/2013/04/03/survey-ri-gets-f-grade-for-its-friendliness-to-small-businesses/

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