CT News Junkie | More Businesses Opened Their Doors In 2015

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More Businesses Opened Their Doors In 2015

by | May 9, 2016 11:00am
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Posted to: Business, Economic Development, The Economy, Jobs, Labor, Taxes

More businesses opened their doors in Connecticut last year than in the previous year, and small businesses led the growth, according to state data.

The number of new businesses starting in 2015 also outnumbered those that closed, according to Secretary of the State Denise Merrill’s office, which tracks business starts and stops monthly.

During 2015, 28,730 businesses opened in Connecticut, a slight uptick from the 28,208 business which formed here in 2014.

Nine months last year saw business starts top 2,000 - every month except January, April and May. June saw the most new businesses open, with 2,657, and most of those - 2,019 - were limited liability companies.

Limited liability companies, or LLCs, are small companies that typically are run by a sole proprietor or partnership.

Over the course of 2015, 13,621 businesses closed statewide, according to the data.The biggest share of business stops, 2,159, came in December, and the bulk of that month’s closures - 1,574 - were limited liability companies.

Business starts and stops are a function of the overall business climate, which in Connecticut is “challenging,” said Donald Klepper-Smith, economist at DataCore Partners.

“(Connecticut) is not known as being business-friendly,” he said, and in the early months of this year “the budget situation has created a significant amount of uncertainty.”

The state will be lucky to see business starts break even with business closures in 2016, Klepper-Smith said. State revenues are declining, he added, which typically is a sign that business formations are slowing.

“It’s probably one of the most dynamic business environments that I’ve seen,” he said. “This is an environment in which business confidence has taken a hit in early 2016. We’re just starting to feel the effect of GE’s departure.”

In climates like this, he said, businesses are very cautious about how and where they expand.

General Electric announced in January, after months of speculation, that it is moving its corporate headquarters from Fairfield to Boston. Company leaders told state officials last year they were contemplating a move amid rising business taxes in Connecticut.

Since then, the state’s business climate has become a focal point, and continues to be.

A state Commission for Economic Competitiveness was formed last year, and members last month received a “diagnostic” report assess the state’s strengths and weaknesses when it comes to business-friendliness.

Among other findings, that report, prepared by the Business Council of Fairfield County Foundation, said other states are “closing the gap” on Connecticut’s competitive advantages such as cost and livability.

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