Improvements in Connecticut’s “Main Street Entrepreneurship” has pushed the state’s ranking to 9th among the nation’s 25 smaller states, up from 12th a year ago, in the latest analysis from the Kauffman Foundation.

The nation as a whole and most states and metro areas are experiencing higher rates of small business activity, according to the 2016 Kauffman Index of Main Street Entrepreneurship.  Nationally, there was a sharp uptick in the survival rate of businesses in the last year. At the same time, Main Street entrepreneurship activity gained ground in 47 states and 38 of the 40 largest metropolitan regions.kauffman

Among the nation’s smaller states, the top ranked entrepreneurial states were South Dakota, Vermont, Montana, North Dakota, Maine, Iowa, Nebraska, New Hampshire.  After Connecticut, Oregon rounded out the top ten.  Connecticut was one of only two states to move up three positions in the ranking.

The state’s rate of business owners was 6.55 percent; the percentage of the adult population that owns a business as their main job, according to the survey data.

The number of established (older than four years) small (less than fifty employees) businesses per 1,000 firms was 649.9 in Connecticut.  In Massachusetts, which ranked third among the nation’s 25 larger states, it is 684.7.  The top ranked larger states were Minnesota, Wisconsin, Massachusetts, Colorado, Pennsylvania, Maryland, Ohio, Louisiana, California and Illinois. state

“The Main Street Entrepreneurship Index provides additional evidence that U.S. small business activity has rebounded from the downturn and continues to gather strength,” said Arnobio Morelix, senior research analyst at the Kauffman Foundation. “More new businesses are making it through their first five years of operation. While this could indicate that a lack of dynamism is allowing less-productive firms to hang on longer, overall the entrepreneurial increases bode well for the established, small businesses that underpin much of our economy.”

Among the larger states, the rate of businesses surviving through their first five years ranges from 44 percent in Arizona to 53.3 percent in Pennsylvania. Among the smaller states, the business survival rate ranges from 43.4 percent in Nevada to 58.1 percent in North Dakota.  In Connecticut, the rate is 51.35 percent, the 8th highest among the 25 smaller states.

In start-up activity, Connecticut ranked 22nd out of 25 smaller states, a drop of two positions since last year.  The Survival Rate of American businesses is the main driver of the recent improvements in Main Street Entrepreneurship in the United States, and has reached a three-decade high of 48.7 percent—meaning that almost half of new businesses make it to their fifth year of operation.chart

U.S. Census Bureau business statistics show that established small businesses represent almost 68 percent of all employer firms in the country.   The five metros with the highest Main Street entrepreneurship activity are Pittsburgh, Boston, Portland, San Francisco and Washington, D.C.

The Kauffman Index of Main Street Entrepreneurship captures business activity in all industries and is based on both a nationally representative sample size of roughly 900,000 responses each year and the universe of all employer businesses in the United States, in a dataset that covers approximately five million businesses.

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