PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

STATE SPOTLIGHT: Employment and Labor Force in the Big Four States  

By at 19 November, 2019, 9:09 pm

by Raymond J. Keating-

The four largest states by population – California, Texas, Florida and New York – split into two very different groups when it comes to their public policy climates for small business, entrepreneurship and investment.

On SBE Council’s “Small Business Policy Index 2019: Ranking the States on Policy Measures and Costs Impacting Entrepreneurship and Small Business Growth,” which ranks the 50 states according to 62 different policy measures, including assorted tax, regulatory and government spending measures, California ranked 49th and New York came in at 47th – second and fourth worst, respectively.  Meanwhile, Texas ranked 1st and Florida 3rd – the very best and third best, respectively.

Such drastic differences in the costs and burdens of government make a real difference in terms of incentives and decision-making, and not just for entrepreneurs, investors and businesses, but also for workers seeking greater opportunity.

The Business Environment and Employment Growth

The latest state employment report from the Bureau of Labor Statistics provides substantive reminders of the differences in these state business environments.

First, if we look at employment growth over the past year, from October 2018 to October 2019, among the 50 states, Florida had the second fastest job growth over the past year – up 2.6 percent – and Texas had the fourth fastest at 2.4 percent.

Those rates were notably higher than California’s 1.8 percent increase and New York’s 1.1 percent rise.

The Business Environment and the Labor Force

Second, again from October 2018 to October 2019, the labor force grew in both Texas and Florida, rising by 185,231 in Texas and by 178,786 in Florida.

However, California and New York actually experienced declines in labor force, with New York down by 76,502 and California off by 57,374.

Yes, policy decisions in the states matter – a great deal.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.

 

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