Arizona is the 6th largest and 14th most populous state in the US, and with a gross state product of around $321 billion, the Grand Canyon state has a larger economy than countries like Ireland and New Zealand.
The state has been one of the fastest-growing states in the nation. Its low tax rates and limited regulations, along with sunny weather and low cost of living, have made it a draw for businesses, particularly small businesses (SMB).
Micro-enterprises, or small businesses, make up a large percentage of businesses in Arizona. They are crucial to the continuous growth of the state’s GDP.
Here are some fascinating statistics about small businesses in Arizona:
- There are 592,485 SMBs, an incredible 99.4% of all Arizona businesses.
- Micro-enterprises employ a total of 1.1 million people—that’s 43.5% of all employees in the state.
- There are 122,590 self-employed minorities, comprising 1.68% of the general Arizona population.
- The major disadvantages of making a real success of a small business in Arizona are the difficulties of accessing start-up and growth capital and the state’s low personal income per capita.
- The tax burden on Arizona's small businesses is generally manageable. The state sales tax is capped at 5.96%, the corporate income tax rate is 6.9%, and the personal income tax rate is between 2.59% and 4.5%.
- If an SMB sells physical goods to Arizona residents, the business owner needs to apply for a transaction privilege tax which is another irritating, minor barrier to entry.
- Arizona’s micro-retailers rank second nationally for foot traffic.
- SMBs generated 27% of Arizona’s $21 billion in total exports. Most of these exports include storage units, furniture, potato chips, peanut butter, and nail polish.
- Self-employed individuals running their own incorporated businesses have an average median income of $51,000.
- The health care and social assistance sectors have the lion’s share of SMB employment, with a total of 167,165 employees.
- Arizona state law requires that every new Arizona LLC designates an Arizona registered agent that will be available during regular business hours at a physical address within the state’s borders.
- Small firms in mining, quarrying, and oil and gas extraction have a pretty low number of SMB employment, with only 1,594 employees and comprising only 1,254 small businesses.
- Not surprisingly, there are 84,588 SMBs engaged in the professional, technical, and scientific services sectors. These are by far the largest industries in Arizona.
- SMBs created 44,301 new jobs in 2019. Firms with fewer than 20 employees account for 25,320 of these new jobs.
Sources
- US Small Business Administration – small business profiles
- Business Daily News
- Making Action Possible