Georgia, South Carolina ranked as business friendly

Thursday, July 2, 2015


Morris News Service

Georgia’s grade of A-minus narrowly tops South Carolina’s B-plus for overall friendliness toward small businesses, according to a survey that revealed business owners’ attitudes toward the government agencies that regulate them.

Nearly 500 small businesses in Georgia and about 200 in South Carolina responded to the survey by Thumbtack, a San Francisco-based consumer service, and the Kauffman Foundation, which promotes entrepreneurship.

Utah, Idaho, Texas, Virginia and Louisiana scored best, while Rhode Island, Illinois, California, Connecticut and New Jersey were deemed least friendly.

But high grades from small businesses isn’t the same as saying a state has lax regulations.

Jon Lieber, chief economist at Thumbtack, said business owners fell into at least two groups: Those who are anti-regulation, and those who believe regulations are a form of consumer protection and want governments to enforce them consistently.

Results in both South Carolina and Georgia showed neither state found regulations particularly unfair or difficult to understand or comply with. And both states received high grades for zoning and land use policies conducive to small businesses.

Thumbtack is expected to release updated data for 2015 later in the summer.

Frank Knapp, president and CEO of the South Carolina Small Business Chamber of Commerce, wasn’t surprised by the findings.

“Most small businesses are OK. They’re not out there complaining, and what they like is consistency,” he said. “Typically when people complain, it’s about a future regulation. … It’s about something that’s unknown. It’s, ‘Oh, that’s terrible. That’s going to make us lose jobs.’”

Knapp said that has more to do with partisanship.

Despite both states’ overall high friendliness scores, Thumbtack found that both struggle with licensing, with Georgia scoring a C-plus and South Carolina a B.

A peeve among small businesses is that licensing is too geographically restrictive and also that renewal fees are too high and the number of training hours too demanding.

A key complaint, according to the survey, came from businesses that were forced to compete with unlicensed practitioners.

“They hate that, because they’ve invested a lot in getting and maintaining a license,” Lieber said.

He pointed to overreaching licensing requirements as another sore spot for small businesses in the service professions.

“Common sense would tell you you don’t need a license to braid someone’s hair,” he said. “Public safety isn’t threatened.”

Both Georgia and South Carolina struggled with training and networking efforts, scoring a C and D-plus, respectively.

“That’s one of the most important categories,” Lieber said. “These guys in the survey are independent business owners. They’re not surrounded by colleagues all day, and it turns out they really appreciate it when there are these kinds of programs available to them … .”

Frequently, Lieber said, it’s not the lack of resources from governments that’s the problem, but programs’ lack of visibility.

Lesia Kudelka, a spokesman for the S.C. Department of Labor, Licensing and Regulation, received a copy of the survey Wednesday and welcomed its findings.

“Governor Haley, LLR and other state agencies have worked very hard to provide an environment that is business friendly, and it is great to see those efforts are paying off for all businesses in South Carolina,” she said.

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