Arizona Ranks 21st for Startup Activity

Date: January 05, 2016

Phoenix area ranks 14th among cities.

Arizona has slipped a notch in a national index measuring startup activity.

According to the 2015 Kauffman Index: Startup Activity report, Arizona ranks 21st in the country for startups, down from 20th last year. Though that’s in the top half, the Grand Canyon State’s neighbors fared better:

  • California: 14 (down from 5th spot last year)

  • Nevada: 10 (up from 21)

  • Utah: 15 (up from 17)

  • New Mexico: 18 (down from 16)

The ranking was based on three factors:

  • Rate of entrepreneurs (percentage of population that became entrepreneurs in a given month): 0.31 percent

  • Percentage of new entrepreneurs who weren’t unemployed when they started the business: 81 percent   

  • Startup density (number of startup firms per 100,000 people): 117

The Phoenix-Mesa-Glendale area ranked 14th among cities for its startup rate.

Another report, the 2015 Kauffman Index: Main Street Entrepreneurship, looked at established small business activity and the business owners. In that study, Arizona ranked 25th out of the largest 25 states, the same as last year. That index measured the percent of the population that owns a business as their main job (6.3 percent) and the number of established small businesses per 100,000 residents (722).

“Main Street Entrepreneurship is at the heart of the American economy,” Maria Contreras-Sweet, administer of the U.S. Small Business Administration, wrote in the report’s foreword. “This index is an important step forward, equipping us with the information required to make wise policy decisions and ensure the continued vitality of our entrepreneurial ecosystem.”

Related Content: Small Business News | Arizona | Economy

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