Best & Worst Cities to Work for a Small Business
Continuing WalletHub’s theme of small business-related releases in honor of National Small Business Week (May 12-16), this study sought to identify the cities that are the most and least friendly to employees of small companies.
There is no shortage of commentary on the best and worst cities to start a small business, after all, and with such companies employing about 47% of the private workforce in this country, paying more than 40% of the private payroll, and creating more than 60% of the new jobs added over the past 20 years, according to the U.S. Small Business Administration, it bears asking what opportunities exist for the roughly 12.3% of people who are currently either unemployed or marginally attached to the labor force, according to data from the Bureau of Labor Statistics.
More specifically, WalletHub’s used 10 different metrics – ranging from net small business job growth and industry variety to hours worked and average wages for new hires – to evaluate the state of small business in the 100 largest metropolitan areas in the United States. We then ranked the cities based on their overall attractiveness for job seekers.
|Rank||Metro Area||Rank||Metro Area|
|1||Minneapolis, MN||51||St. Louis, MO|
|2||Salt Lake City, UT||52||San Jose, CA|
|3||Miami, FL||53||Ogden, UT|
|4||Madison, WI||54||New Orleans, LA|
|5||Oklahoma City, OK||55||Phoenix, AZ|
|T-6||San Francisco, CA||56||Charleston, SC|
|T-6||Denver, CO||57||Akron, OH|
|8||Seattle, WA||58||Cape Coral, FL|
|9||Dallas, TX||59||Hartford, CT|
|10||Indianapolis, IN||60||Providence, RI|
|11||New York, NY||61||Louisville, KY|
|12||Boston, MA||62||Milwaukee, WI|
|13||Houston, TX||63||Colorado Springs, CO|
|14||Omaha, NE||64||Oxnard, CA|
|15||Nashville, TN||65||Springfield, MA|
|T-16||Austin, TX||66||Dayton, OH|
|T-16||Bridgeport, CT||67||Little Rock, AR|
|18||Los Angeles, CA||68||Baton Rouge, LA|
|19||Des Moines, IA||69||Greensboro, NC|
|20||Portland, OR||70||Detroit, MI|
|21||Tulsa, OK||71||Sacramento, CA|
|22||Grand Rapids, MI||72||Allentown, PA|
|23||Columbus, OH||73||Toledo, OH|
|24||Chicago, IL||74||Poughkeepsie, NY|
|25||Charlotte, NC||75||Wichita, KS|
|26||Pittsburgh, PA||76||Las Vegas, NV|
|27||Richmond, VA||77||Virginia Beach, VA|
|28||Atlanta, GA||78||Honolulu, HI|
|29||Raleigh, NC||79||Columbia, SC|
|30||Kansas City, MO||80||Knoxville, TN|
|31||North Port, FL||81||Worcester, MA|
|32||Boise City, ID||82||Birmingham, AL|
|33||Philadelphia, PA||83||McAllen, TX|
|34||Baltimore, MD||84||Memphis, TN|
|35||Greenville, SC||85||Tucson, AZ|
|36||Orlando, FL||86||Albuquerque, NM|
|37||Cleveland, OH||87||El Paso, TX|
|38||Lancaster, PA||88||New Haven, CT|
|39||Albany, NY||89||Palm Bay, FL|
|40||Jacksonville, FL||90||Lakeland, FL|
|41||Provo, UT||91||Youngstown, OH|
|42||Tampa, FL||92||Fresno, CA|
|43||Buffalo, NY||93||Riverside, CA|
|44||Rochester, NY||94||Chattanooga, TN|
|45||Harrisburg, PA||95||Bakersfield, CA|
|46||Cincinnati, OH||96||Scranton, PA|
|47||San Antonio, TX||97||Jackson, MS|
|T-48||Washington, DC||98||Augusta, GA|
|T-48||San Diego, CA||99||Modesto, CA|
|50||Syracuse, NY||100||Stockton, CA|
6 Tips for Landing a Small Business Job
- Tailor Your Search, But Avoid Limiting Yourself: You obviously don’t want to cast too wide of a net, as that will simply increase the odds of missing a job you’d be perfect for as well as limit your ability to pay enough attention to each lead. However, it’s perhaps equally bad to put yourself in a box in terms of the types of jobs you’re willing to consider, the starting pay you require, and even the city in which you’ll live. So, try to leave your preconceptions behind and instead focus on the jobs for which your skills are appropriate (rather than what your degree is in), no matter where they may be.
- Move Proactively If Necessary: The entrepreneurs who run successful small businesses (which is where you want to be) are busy folks who garner a lot of interest from local job applicants. They tend to give these candidates more consideration, as it’s simply easier to interview them and more likely they will accept a job if offered. So, if you’re not finding the type of job you want where you’re currently living, you should definitely at least consider moving to one of the highest ranked cities in this study.
- Focus on the Future: Job seekers have a tendency to overly emphasize immediate compensation and the sheer availability of a job, any job. While there is obviously something to be said for being able to pay the bills in the short term, it’s also important to consider opportunities for growth within a given company, the likelihood of said company achieving long-term success, and the potential for skills development that could help you find other work in the future.
- Customize Your Approach: It’s amazing how little care most job applicants put into their search. Many simply apply en masse, thinking this will give them the greatest odds of finding a job. In truth, however, they’re severely minimizing their chances of finding the right job. It’s therefore important to not only customize your cover letter and resume for each position that you have serious interest in, but also to research each respective company as well as its leadership and human resources staff in order to find commonalities and gain a sense of the type of employee their looking for.
- Mind Your Online Footprint: As familiar as we’ve become with the Internet and social media, people still seem to forget that online information is accessible to everyone. Before applying for any jobs, it’s a good idea to adjust your privacy settings on all social media accounts as well as have explanations ready for any publically available information that might reflect poorly upon you.
- Have a Positive Attitude: Not only is it important to stay positive in the face of rejection, but you also have to remember that employers are looking for people who fit their organizational culture and will be pleasant to work with every day. What’s more, an eagerness to learn can be enough to get you a serious look for jobs for which you might not have a perfect background.
Ask the experts
WalletHub used the following metrics to evaluate each major metropolitan area’s small business friendliness:
- Number of Businesses with Under 250 Employees Per 1,000 Inhabitants – (Weight = 1): The opportunity that job seekers have to find employment with a small business in a particular metropolitan area obviously depends, at least in part, on the sheer number of such business entities in operation there. The U.S. Small Business Administration defines a “small business” differently depending on the industry, and while the upper limit for certain industries is a private company with 500 employees, Wallet Hub chose to use a smaller number that is more in line with what the average person considers a small business to be.
- Industry Variety – (Weight = 1): This metric was used to evaluate the balance of each metropolitan area’s small business community in order to gauge the opportunities available to job seekers irrespective of career focus. After all, a given city might boast tech jobs aplenty, yet have little to offer folks interested in other fields.
- Net Small Business Job Growth – (Weight = 1): This metric was used to indicate whether a given metropolitan area’s small business workforce is expanding or contracting. While a city with a large number of small business jobs might seem attractive on the surface, new opportunities could be few and far between if that number is consistently dwindling.
- Small Business Vitality – (Weight = 1): This index tracks small business job growth relative to workforce and population trends.
- Average Number of Hours Worked – (Weight = 1): It’s no secret that small business employees tend to pull long hours, but it’s also important to strike a healthy work-life balance. So, for this metric, lower numbers of hours worked were viewed favorably.
- Average Monthly Earnings for New Hires – (Weight = 1): While there is indeed something to be said for the sheer availability of jobs in this economy, job seekers want to make sure what they make will pay the bills. This metric was used to rank metropolitan areas based on how much the average new hire earns per month.
- Unemployment Rate – (Weight = 1): This metric was used to gauge the competition for available jobs in each metropolitan area.
- Average Disposable Income – (Weight = 0.5): This metric shows how much money area workers have to spend after current expenses have been subtracted.
- Cost of Living – (Weight = 1): This metric adjusts for regional price and wage differences, enabling direct comparison of how much spending power the average citizen has in each major metropolitan area.
- Well-Being Index – (Weight = 0.5): Working for a small business can be very stressful given the often long hours, uncertain future, and pressure of a down economy. This is only magnified in areas known for their stressful lifestyles, so low scores in this index were viewed favorably for this study.
Using the most recent data available (see below for sources), we rank-ordered the 100 largest Metropolitan Statistical Areas (MSAs) in the United States, as determined by Census Bureau data, for each of the above metrics and then weighted each metric according to the breakdown above to develop the final rankings.
Sources: Data used to create these rankings is courtesy of the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, the Council for Community & Economic Research, the American City Business Journals and Gallup Healthways.