How friendly is Atlanta and Georgia, generally, toward small business?
Although this is a critical question that local politicians regularly confront in election years, there is surprisingly little data to answer it. However, a recently released survey shines new light on the issue.
The Thumbtack.com National Small Business Survey, conducted in partnership with the Kauffman Foundation, is a national report card of how friendly states and cities are to entrepreneurs and job creators. This survey is unique from other indexes that attempt to rank the best and worst places to do business in the United States because it goes directly to the source: the small-business owners themselves.
By drawing from the 275,000 small-business owners and managers who list their services on Thumbtack.com, we were able to capture nuances that are difficult or impossible to measure through other data sources or that are often ignored altogether.
Small businesses ranked Atlanta as the fifth-friendliest city and Georgia as the sixth-friendliest state in the nation toward small business. Small-business owners in Georgia clearly thought their state was a friendly place to do business.
Not only do we know how Atlanta and Georgia ranked nationally, we also evaluated what drives the rankings. While taxes and federal regulations often dominate discussions of what matters to business, small-business owners’ responses told a different story.
More than 6,000 small businesses nationwide participated in the survey. The message was overwhelming: Professional licensing regulations are almost twice as important to small businesses as are tax-related regulations. More than half of the survey’s respondents also were subject to special regulations, like annual licensing fees for pet sitters or monthslong permitting processes for electricians. The ease of complying with these requirements was by far the most important factor in their determination of a city or state’s overall friendliness toward small business.
Another important factor driving friendliness rankings was the availability of local networking and training programs for small businesses. The programs typically cited by survey respondents were those held by local chambers of commerce, small business development centers and Small Business Administration offices.
Small businesses gave Atlanta an “A+” and Georgia an “A” for their networking programs. Businesses graded them similarly well for their training programs.
Again and again, we heard small-business owners pining not for less government, but for smarter government. The states and cities that rated best were not necessarily those with the lowest tax rates or fewest rules. Instead, they were regions with coherent and consistently enforced licensing requirements and those that provided well-publicized training and networking programs.
Although most small businesses told us great things about doing business in Georgia, there were also strong feelings about how things could improve. The state was middle of the pack with a “B” grade for licensing regulations, with small businesses commenting that the process could be clearer and faster.
For example, a roofer complained of the hassle associated with needing a separate license for every county in which he did business. Zoning regulations were also a weak point, with both Georgia and Atlanta receiving a “B-” in the category.
Overall, however, it’s clear that small businesses see Georgia as one of the friendliest places in the nation to set up shop. As one small business owner explained: “Atlanta is a place of opportunity and the state is very supportive. You just have to be willing to work hard to push your business.”
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Sander Daniels is co-founder of Thumbtack.com, a website in which you can hire help from local, pre-screened businesses.
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