Wisconsin has improved its Main Street Entrepreneurship ranking to No. 2 among the 25 largest U.S. states, according to a new report released today by the Ewing Marion Kauffman Foundation.
Wisconsin last year was ranked No. 3 on the Kauffman Index of Main Street Entrepreneurship, which surveys about 900,000 businesses across the country and orders states based on their rate of business owners, established small business density and survival rate of firms. This ranking focuses on companies that have been around five years or longer, and have fewer than 50 employees.
In the 2016 survey, only Minnesota beat Wisconsin in the Main Street Entrepreneurship rankings. The Badger State has a 6.46 percent rate of business owners, or the percentage of an adult population in a given area that owns a business as their main job; a 704.3 established small business density, which measures the number of established small businesses (employing at least one but fewer than 50 employees and more than five years old) per 1,000 firms; and a 50.8 percent survival rate of firms, or those that have operated past the five-year mark.
The report also breaks down Wisconsin business owner demographics. In 2015, 8.4 percent of men in Wisconsin owned a business as their main job, while 4.5 percent of women owned a business as their main job. Wisconsin was in the top five among the larger states for highest rates of female business ownership.
Demographic trends show racial disparities in Wisconsin business ownership. About 7.1 percent of whites in Wisconsin own a business, while 5.6 percent of Asians in the state own a business, 4.1 percent of Latinos in Wisconsin own a business, and just 2 percent of African Americans in Wisconsin own a business.
Along age lines, 8.9 percent of those ages 45 to 54 in the state own a business, 8.3 percent of those 55 to 64, 6.9 percent of those 35 to 44 and 3 percent of those ages 20 to 34. Wisconsin was in the top five larger states for the highest rates of young adult business ownership for those ages 20 to 34. Wisconsin was in the top five among the larger states for the highest rates of business ownership among adults aged 55 to 64.
But on the metropolitan side, the Milwaukee-Waukesha-West Allis metro area did not fare as well in the report. Main Street entrepreneurship activity was up in 38 of the 40 largest cities in 2016, according to the report.
The Milwaukee area came in at No. 22 in the rankings of the 40 largest metros, down from 18th last year. Milwaukee’s rate of business owners is 5.6 percent, its established small business density is 657.11 and its business survival rate is 46.8 percent.
First place in the metro category went to Pittsburgh, followed by Boston, Portland, San Francisco and Washington, D.C.
Milwaukee and Wisconsin have not fared as well in other Kauffman entrepreneurship rankings this year. The Milwaukee-Waukesha-West Allis metropolitan area ranks 39th among the 40 largest metropolitan areas in the country when it comes to startup activity and ranks 31st in entrepreneurial business growth. Wisconsin ranked dead last in startup activity and 23rd in entrepreneurial business growth among the 25 largest states.