Despite the high cost of starting a business, Illinois beat most states when it came to five-year survival rates for new businesses.
A study by Bookipi, an invoicing software company, determined how many new businesses formed in each state in 2018 by using U.S. Bureau of Labor Statistics data. The study then analyzed how many of these businesses remained in operation in 2023.
Illinois had the eighth highest five-year survival rate when compared to other states.
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Of the 22,145 Illinois businesses created in 2018, the study found that 55.07% – or 12,195 businesses – remained in operation five years later. According to the same study, however, employment at these establishments declined by 1,045 people during the same five-year span, “indicating that some businesses may have had to cut employees to survive.”
States which outranked Illinois in the study included:
Montana: 57.63%Minnesota: 57.61%Alaska: 57.32%West Virginia: 57.08%Massachusetts: 56.68%Virginia: 56.52%South Dakota: 56.08%
“According to the US Bureau of Labor Statistics, approximately 45% of new businesses fail within the first five years, making the success rates in states like Montana, Minnesota, and Alaska particularly impressive,” said Bookipi Group CEO and founder Tim Lee.
“Entrepreneurs seeking a promising start should consider these states, where the likelihood of success is significantly higher.”
Conversely, Illinois neighbor Missouri ranked lowest – with a 44.55% survival rate from 2018 to 2023. However, the state also saw increased employment at the surviving businesses.
The study noted: “This 3.02% rise could indicate quality over quantity for Missouri businesses.”
More: Study claims Illinois one of most expensive places to start a business. Here’s why
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Publish date : 2024-09-03 21:31:00
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