Connecticut Ranks High for Entrepreneurship
Study also highlights Nutmeg State’s weaknesses
According to the 2012 State Entrepreneurship Index (SEI) from the University of Nebraska-Lincoln (UNL), Connecticut ranks 12th among the 50 states in entrepreneurial activity.
Based on 2011 data, SEI rankings are determined by combining five key components of a state’s level of entrepreneurship:
- Percent growth in employer establishments
- Per capita growth in employer establishments
- Business formation rate (establishment births per person)
- Patents per thousand persons
- Average income per non-farm proprietor.
“To reach the top of the rankings, a state had to do very well in at least four of the five categories that make up the index,” says Eric Thompson, associate professor of economics at UNL and director of the university’s Bureau of Business Research. “This year, those states tended to be clustered in the Northeast and the upper Midwest.”
Good but Not Great
Connecticut’s relatively high ranking is a bit misleading, because it reflects very high scores in two categories: patents per thousand persons (9) and proprietor income (3): but rather dismal scores and a downward trend in three:
- Percent establishment growth: 37 (30 in 2010)
- Per capita establishment growth: 30 (24 in 2010)
- Business formation rate: 38 (37 in 2010)
“It’s encouraging that Connecticut ranked 12th overall,” says CBIA Vice President and Economist Pete Gioia, “But if we address the significant weak points, we could end up number one very easily.”
Key Competitors Score Higher
Five regional competitors were among the 11 states ranking higher than Connecticut for entrepreneurship: Massachusetts (1), North Dakota (2), California (3), New York (4), Minnesota (5), Oregon (6), New Jersey (7), Texas (8), Illinois (9), New Hampshire (10), and Pennsylvania (11).
Northeastern states scoring below Connecticut included Vermont (16), Maryland (17), Rhode Island (19), Delaware (21), and Maine (29).
The five worst states for entrepreneurial activity were Kentucky (46), Mississippi (47), South Carolina (48), Michigan (49), and Louisiana (50).
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