A new report lists Alabama alongside Minnesota, Alaska, West Virginia, Massachusetts, Virginia, South Dakota, Illinois, Michigan and top ranked Montana as States where new businesses were likely to survive.
The invoicing software company, Bookipi, analyzed data from the US Bureau of Labor Statistics on the number of new businesses launched in each state in 2018 and those still operating in 2023. This data was then used to calculate the five-year survival rate for new businesses in each state, highlighting the top states for starting a new business.
Number ten ranked Alabama rounds out the top ranked States with a five-year survival rate of just over 54%. Back in 2018, almost eight thousand businesses were launched. Just over four thousand survived by 2023. This is considered a respectable rate of close to 3% above the national average of nearly 52%. Employment in these businesses grew from 43,000 to just over 46,000 -- a 6% increase over the five-year period.
Top ranked Montana has emerged as the best state in the US to start a new business, with an impressive rate of 57% of new businesses launched in 2018 still operational after five years. The study found that just over three thousand businesses were launched in 2018, and 1,700 survived until 2023. Employment in these businesses reflected a near 4% rise over five years.
Minnesota ranks second in the US for new business survival, with a five-year survival rate of close to 58%. Number three ranked Alaska, saw 57% of its new businesses remaining in operation. That compared to West Virginia which had close to 57% business survival. Virginia and Massachusetts round out the top five.
Missouri, New Hampshire, Kansas, Nevada, Idaho, Wyoming, Delaware, New Mexico, Georgia, and Washington are the States at the bottom of the ranking. Missouri did the worst in the Bookipi study with just over 45% of its new businesses remaining open after five years. Washington did the best among low-ranking states with a nearly 49% survival rate.
