North Carolina Ranked 5th in New Study on Small Business Climate

North Carolina has earned another high score for business as fintech company Lendio has put the Tar Heel State fifth in its 2023 rankings of best states for small business.

The list cites North Carolina’s rapid population growth, above-average small business survival rate and low corporate tax rate of 3% as leading factors in its rankings.

“North Carolina has been a hot place for in-migration, with 99,796 people moving there in 2022 (the 3rd highest in the U.S.),” the report says. “With low housing costs, business owners find it an attractive location to start and run a small business.”

Other reports, such as this one by Bankrate, have cited North Carolina’s statewide average cost of housing as below the national median, but higher than the median for the state’s biggest metropolitan areas.

Lendio puts Texas atop its list. The high volume of small business loans, high survival rate of small businesses, and no state income tax help make Texas the most attractive state for small business, Lendio says. Florida came in second, followed by Ohio and Massachusetts.

Overall, starting a business has never been more popular, Lendio says, despite challenges brought on by inflation and lingering effects of the pandemic. A January statement from the White House said more than 10 million new business applications had been filed in the 2021-2022 two-year period, more than at any other time.

Utah-based Lendio is an online marketplace that helps business owners find and secure financing. The company used such metrics as small business lending, cost-of-living and real estate data, workforce education and corporate tax rates in developing its list.