Best & Worst Cities to Work for a Small Business

Small businesses collectively make up 99.7 percent of all U.S. employer firms, employ nearly 49 percent of the private workforce, pay about 42 percent of the private payroll, and created 63 percent of all new jobs added during the past 20 years, according to the U.S. Small Business Administration. Considering their omnipresence alone, it’s no wonder these job creators merit a five-day national recognition each year.

But with no shortage of commentary on the best cities to start a small business, we turned the tables and asked which cities are best to work for one. WalletHub analyzed the small business environment within the 100 most populated U.S. metro areas to assess their friendliness toward employees and job seekers. We did so using 11 key metrics, ranging from net small business job growth to industry variety to earnings for small business employees. The results of our study, as well as expert commentary and a detailed methodology, can be found below.

Main Findings

6 Tips for Landing a Small Business Job

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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: Working for a Small Business

Working for a small business has its pros and cons — at least compared with working for a large corporation. For additional insight on the good and bad, we turned to a panel of small business experts. Click on the experts’ profiles below to read their bios and responses to the following key questions:

1. What are the pros and cons of working for a small business?
2. What questions should job seekers ask when interviewing for a job at a small business?
3. Do small businesses provide recent graduates with more or less opportunities than a larger corporation?

Ask the Experts

Jeffrey Hornsby
Henry W. Bloch/Missouri Endowed Chair of Entrepreneurship and Interim Director of Regnier Institute for Entrepreneurship and Innovation at University of Missouri-Kansas City, Henry W. Bloch School of Management
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Oded Shenkar
Ford Motor Company Chair in Global Business Management and Academic Director of The National Center for the Middle Market at Ohio State University, Fisher College of Business
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Cynthia Guthrie
Assistant Professor of Management at Bucknell University (formerly senior vice president at Aon Consulting)
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Rick McPherson
Lecturer in Management and Organization at University of Washington, Foster School of Business
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Alex F. DeNoble
Professor & Executive Director of Lavin Entrepreneurship Center at San Diego State University, and President of The United States Association for Small Business & Entrepreneurship
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Dennis S. Passovoy
Lecturer and Sam Walton Fellow in Free Enterprise at University of Texas at Austin, McCombs School of Business
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More Experts

Methodology

In order to identify the cities that are most and least friendly toward small-business employees, WalletHub assessed the microbusiness environment within the 100 most populated U.S. metropolitan statistical areas (MSAs) across two key dimensions: “Small Business Environment” and “Economic Environment.” We then identified 11 metrics that are relevant to those dimensions to develop the final rankings. Our data set is listed below with the corresponding weight for each metric.

Small Business Environment – Total Weight: 10

• 
  Number of Small Businesses (with Fewer than 250 Employees per 1,000 inhabitants): Full Weight
• 
  Growth in Number of Small Businesses (with Fewer than 250 Employees): Full Weight
• 
  Net Small Business Job Growth (Number of Job Gain/Loss per Number of People Employed, for Firms with Fewer than 250 Employees): Full Weight
• 
  Industry Variety: Full Weight
• 
  Percentage of Small Businesses Offering Health Insurance to Employees: Half* Weight
• 
  Earnings for Small Business Employees (Adjusted for Cost of Living): Full Weight

Economic Environment – Total Weight: 5

• 
  Median Annual Income (Adjusted for Cost of Living): Full Weight
• 
  Unemployment Rate: Full Weight
• 
  Well-Being Index: Half Weight
• 
  Average Number of Hours Worked: Full Weight
• 
  Population Growth (Projected Population in 2042 vs. 2012): Full Weight

 
Sources: Data used to create these rankings were obtained from the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, the Council for Community & Economic Research, the Kaiser Family Foundation, the United States Conference of Mayors and Gallup Healthways.