Vermont ranked next-to-last among states in which to start a business

If you’re considering starting a business in Vermont, you may want to rethink your plans.

Earlier this month, the personal-financial website WalletHub released a new report titled “2019’s Best and Worst States to Start a Business.” According to the online report, Vermont is failing to measure up on several economic fronts, even with a booming Trump-era economy and stock market.

Lou Varricchio

While Vermont performs poorly in most business rankings, it showed up well in “office space affordability” in a new WalletHub economic report. Pictured: Jeremy Lang, a web developer from Cleveland, Ohio, has rented a high-tech co-working space in Vergennes.

In the study, Vermont was ranked 49th among the 50 states when it comes to starting a business. The state’s performance should be embarrassing to state legislators and voters, although other New England states didn’t do much better.

Maine, overall, was the best place to start a business in New England, coming in at 23rd. Rhode island was dead last, right after Vermont, in overall “worst state” rankings.

WalletHub found Vermont’s cost of living to be high (41st), and dead last (50th) in the “access to resources” ranking. This critical ranking includes access to business financing, access to higher-education assets, access to a college-educated population, access to “human-capital,” and being in a state with growth of working-age folks.

The only bright spots for Vermont is its positive “office-space affordability” ranking (16th) and “business costs” ranking (23rd).

The report’s findings for Vermont — with 1 being “best” and 25 being “average” — are as follows:

• 49th – Average growth in number of small businesses
• 16th – Office-space affordability
• 31st – Labor costs
• 50th – Availability of human capital
• 44th – Average length of a work week (in hours)
• 41st – Cost of living
• 38th – Industry variety

In preparing the  report, WalletHub’s research team used several guiding factors relating to small business startup successes. These factors included 26 key indicators, such as availability of skilled workers and office-space affordability.

Brandon Scott Cohen, of the University of Akron’s College of Business and Innovation, was one of WalletHub’s experts behind the report.

According to Cohen, economic policy leaders in states like Vermont should be sensitive to tax rates, especially when it comes to welcoming new business startups, which are essential to local employment and growth.

“I think corporate tax levels are more relevant to where a business is started as opposed to whether a business is started,” Cohen said. “ … Money flows to the lowest barriers and those entrepreneurs that want to start a business will simply move if the state tax policies are too high for the business to thrive.”

WalletHub photo

Joseph Fox: “State policies certainly have an impact on whether and where to start a business.”

Another WalletHub expert, Joseph Fox, director of the University of Akron’s Fitzgerald Institute for Entrepreneurial Studies, believes state policies often make or break local new businesses.

“State policies certainly have an impact on whether and where to start a business,” he said. “Anecdotally, look no further than a recent example in (red-state) Texas. Governor Abbott signed a law allowing individuals to order beer and wine for delivery with food to their home. In a time where food delivery startups are still expanding, a small change like this might entice an entrepreneur to create something to address this potential new opportunity.”

WalletHub expert attorney Patrick Gaughan, of the University of Akron’s Innovation Practice Center, noted that while state corporate tax rates are of little importance, “overall tax and regulatory approaches of different states will have an impact on the perceived support for new business start-ups and growth.”

When it comes to entrepreneurship, getting a new business off the ground in Vermont is one thing; keeping the business vibrant is a different matter entirely.

Dick and Flanzy Chodkowski are owners of Monroe Street Books, the state’s largest bookstore, located along U.S. Route 7 in Middlebury.

“Dick and I were talking this morning about downtown Middlebury. I was down there last Saturday morning and it was dead,” Flanzy Chodkowski told TNR. “We wondered how businesses are surviving.

“When we [came here] in 1991, Middlebury was thriving, or so it seemed. Now … (the Middlebury Selectboard) is paying someone to work on getting businesses here, but they may mean mostly on Exchange Street (Middlebury’s industrial park area).”

Lou Varricchio

Dick Chodkowski, owner of Monroe Street Books

The Chodkowskis, and others like them, point to various factors when it comes to downtown Middlebury’s current stagnation: municipal policies that eliminated automobile parking spaces in favor of a carbon-free agenda, selectivity about types of businesses that are welcome in town, plus high rents.

As noted above, when it comes to office space affordability, the WalletHub report ranked the Green Mountain State 16th, which seems to reflect that better prices for startup businesses are found outside of Vermont’s so-called gold towns.

WalletHub is not alone in seeing weaknesses in Vermont’s appeal for entrepreneurs. According to a policy brief published by the Ethan Allen Institute, Vermont gets consistently poor ratings for business climate: “The Tax Foundation (in 2014) placed Vermont 45th out of 50, Forbes 43rd, CNBC 42nd, and the British-based Economist gave Vermont an “F,” one of just five states to receive one. These judgments are based for the most part on high taxes, complex regulations, poor infrastructure, and an inadequate work force. Vermont’s population is not growing, and the state’s demographics are trending older.”

Lou Varricchio is a freelance reporter for True North Reports. Send him news tips at lvinvt@gmx.com.

Images courtesy of Wikimedia Commons/Mike Kalasnik and Wallethub photo

8 thoughts on “Vermont ranked next-to-last among states in which to start a business

  1. In Vermont, with a near-zero, real-growth economy, carbon tax revenues would be used to create even more government programs for more social engineering purposes, to create beneficiaries who will vote for the program creators. It is a form of socialism.

    Here is what Putin has to say about Vermont’s socialism:
    Putin warned the Obama administration against further adoption of socialism, saying Russian history clearly proves it is a recipe for failure.

    “Any fourth grade history student knows socialism has failed in every country, at every time in history,” said Putin. “President Obama and his fellow Democrats are either idiots or deliberately trying to destroy their own economy.”

    Economists say Putin’s comments serve to illustrate how worldwide markets have made even economic adversaries dependent on each other’s financial stability.

    Various spokes people, including democrat-socialist Sanders, dismissed Putin’s claim, saying, “We’re going to do socialism better.”

    Now that is pure hutzpah.

    Here is loud-shouting, arm-waving, multi-millionaire, SOCIALIST Bernie Sanders, getting close to 80 years old, with three houses, and a $70,000 Audie (supporting the GERMAN worker), and

    – Flying FOR FREE on private planes spewing CO2, for spouting his SOCIALIST and GLOBAL WARMING rhetoric nationwide on some else’s dime (his foundation is buying carbon offsets, a cost of “doing business”; a PR gesture!), and

    – Not liking a proper barrier to protect the US southern border (purposely enticing unskilled illiterates, not successful in their own country, to easily enter the US, because they will ultimately become Democrat voters!), and

    – Having his own tax-exempt foundation (don’t pay me, as I would have to pay federal and state income taxes, pay my tax-exempt foundation!), and

    – Promising more and more goodies to his favored supporters, including free health care for everyone, including 11 to 15 million illegals, and forgiveness of student debt (setting a poor example for their future behavior) to raise his fading poll numbers, and

    – Campaigning for even more US-style Socialism to benefit his foundation, a la Clinton and a la Gore, all smooth-operating, self-serving hucksters!! They know how to play the game to their advantage.

    • Addition:

      The SOCIALIST LEFT see the GLOBAL WARMING scare as an opportunity to remake the world economy.

      OCASIO-CORTEZ’S CHIEF OF STAFF ADMITS WHAT THE GREEN NEW DEAL IS REALLY ABOUT — AND IT’S NOT THE CLIMATE by Peter Hasson, July 11, 2019
      https://dailycaller.com/2019/07/11/saikat-chakrabarti-green-new-deal/

      Democratic New York Rep. Alexandria Ocasio-Cortez’s “Green New Deal” is more about drastically overhauling the American economy than it is about combatting climate change, her top aide admitted.

      Ocasio-Cortez’s chief of staff, Saikat Chakrabarti, made the revealing admission in a meeting with Democratic Washington Gov. Jay Inslee’s climate director in May. A Washington Post reporter accompanied Chakrabarti to the meeting for a magazine profile published Wednesday.

      “The interesting thing about the Green New Deal, is it wasn’t originally a climate thing at all,” Chakrabarti said to Inslee’s climate director, Sam Ricketts.

      “Do you guys think of it as a climate thing?” Because we really think of it as a how-do-you-change-the-entire-economy thing,” Chakrabarti added.

      Ocasio-Cortez’s press office didn’t immediately return an inquiry regarding whether Chakrabarti’s admission would undermine the congresswoman’s Green New Deal advocacy.

      The Green New Deal calls for a number of hard left proposals, including getting the U.S. entirely off of fossil fuels within 10 years, providing universal health care, basic income programs and job guarantees.

      The proposal also calls for “social, economic, racial, regional and gender-based justice and equality and cooperative and public ownership.”

      Transitioning to “clean, renewable, and zero-emission energy sources” within 10 years — just one of the Green New Deal’s expensive proposals — could cost more than $5 trillion, according to one estimate.

  2. And this is a surprise to…………..NO ONE. Vermont has been under the heel of the lefttard Democrats and their GreenShirtGestapo for so long that it has actually become a socialist/communist state. People who elect hard left socialists like Bernie, Pat Leahy and Peter Welch are getting exactly what they derseve and what they voted for.

    So why did Vermont go down the socialist tubes so fast? Because Vermonters chose to believe the lies of the Vermont Democrat Party that promised them endless freebies if they just voted for Bernie, Leahy, and other Democrats to the end of time.

    The bottom line is that Vermonters are jealous and envioius of those who have more than they do, and they are greedy besides. Worse yet, they do not want to work for it. So they vote for the liars who promise them the most “stuff” for free.

    You made your bed Vermont, now you can lie in it.

  3. no surprise to any born here.. the flatlanders came , conquered and destroyed what was
    VT of the pre 70’s. Maine will follow as their moving to a more leftarded government that
    destroys all they control.

    • As you said…. everyone knows this and VT will continue it’s clockwise spiral down the toilet.

      I don’t think NH will be the last hold out for much longer. Even my brother who lives there is starting to see it. Although probably 30 years behind VT. Although given that the work is coming to an end in 12 years it might not matter much. 🙂

      • You do know don’t you that 12 years end of the world has been coming since sometime in the late 1970s? — It came up right after all the predictions of the Population Bomb that was going to starve everyone to death failed to gain traction.

        • There is always a dooms day scenario for the left to garner votes from. That’s how they rule. There was a plan to sprinkle ash on the polar caps in the 70’s because we where in a global cool period. It’s no surprise that the global warming crowd always use the 1970’s as a starting point That decade happened to be one of the coldest in modern history. But hey it fits their narrative.

  4. All those touchy feely folks in this state have just ruined the business climate in Vermont……….thanks for nothing!

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