How Does Milwaukee’s Small Business Scene Compare Nationally?
It's a great place for women to start businesses, but terrible for Hispanic entrepreneurs.
A successful small business can be built anywhere. It all depends on the individual(s) running the show, the idea, execution and perhaps a bit of luck. But with that being said, some areas do seem to make things a whole lot harder than others. After all, how else do you explain the fact nearly 64% of new businesses in Albuquerque, N.M., fail within five years, versus 40% in Worcester, Mass.?
The truth is that a small business owner’s physical surroundings actually affect far more than our increasingly globalized, connected economy would lead most people to believe. In fact, location dictates some of a small business’s most significant expenses – including taxes, office space and talent – while the area’s work ethic and overall vibe help mold the company’s soul.
So, I’m sure you’re wondering: How does Milwaukee compare when it comes to small-business nurturing?
It’s a fair question considering that Milwaukee, like most of the country’s major economies, has endured a combination of struggle, transformation and resurgence in recent years. But at a high level, things appear to be in pretty good – though not great – shape, as evidenced by the city’s rankings in a quartet of recent WalletHub research reports:
|Study||Where Milwaukee Ranks|
|Best Cities to Start a Business||39th (out of 100)|
|Best Cities to Work for a Small Business||52nd (out of 100)|
|Best Cities for Women-Owned Businesses||5th (out of 100)|
|Best Cities for Hispanic Entrepreneurs||128th (out of 150)|
Of course, diving deeper into the numbers is necessary to truly understand the current state of Milwaukee’s small-business scene. Countless factors contribute to the relative strength of a business community, after all, with matters of taste and perspective playing no small role.
Low income level and office-space prices might be music to the ears of an aspiring entrepreneur, for example, yet anathema to city officials. And some small business owners want workers who are used to pulling long hours, while others prize a more laid-back environment. Then again, there are some metrics – such as business survival and revenue-growth rates – that everyone can agree on.
So in the interest of telling you the full story, we compiled a smattering of key statistics, gleaned largely from U.S. Census Bureau data, that collectively tell a more complete story about Milwaukee’s place in the country’s small business hierarchy.
|Category||Best City/State||Milwaukee (Percentile)||Worst City/State|
|Small Business Growth Rate (2008-2014)||Grand Rapids, MI (25.22%)||6th percentile(-5.37%)||Toledo, OH(-13.19%)|
|5-Year Survival Rate||Worcester, MA (60.1%)||98th percentile(56.4%)||Albuquerque, NM
|Price of Office Space per Square Foot||Toledo, OH($11.63)||79th percentile($14.50)||San Francisco, CA ($99.42)|
|Average Revenue Growth (2007-2012)||San Antonio, TX(117.83%)||49th percentile(10.51%)||Fremont, CA(-73.91%)|
|Corporate Tax Burden||Sioux Falls, SD||45th percentile||Des Moines, IA|
|Workforce Education (Bachelor’s or Higher)||Irvine, CA
|20th percentile(22.8%)||San Bernardino, CA (11.7%)|
|Median Household Income||Detroit, MI
|89th percentile*($35,489)||Fremont, CA ($103,591)|
|Length of Average Work Week||Fayetteville, NC(41.5 hours)||10th percentile (36.6 hours)||Tallahassee, FL(34.8 hours)|
|Cost of Living Index||New York City, NY (200.3)||44th percentile(100.3)||Laredo, TX(75.0)|
Note: Percentile rankings are based on what is most advantageous to small business owners, not ordinary consumers.
So to sum things up, Milwaukee appears to be a middle-of-the road small-business destination in many respects, with relatively cheap labor and real estate being somewhat offset by a workforce with fairly low educational attainment and an overall work ethic that leaves something to be desired. But what really stands out is the fact that Milwaukee’s small businesses are survivors. And at the end of the day, that’s the only metric that truly matters.
Odysseas Papadimitriou is CEO of the personal-finance website WalletHub, which offers free credit scores, full credit reports, 24/7 credit monitoring and customized money-saving advice.