It’s no secret that some cities are more welcoming than others when it comes to supporting small businesses. The economic stability of an area, the tax climate, and the size of the prospective talent pool can all be important factors to consider before planting roots in a city.

For those seeking out employment in the small business arena, especially those considering starting HVAC contracting companies, a recent report has broken down the best places across the U.S. to work for a small business.

WalletHub’s 2015 Best & Worst Cities to Work for a Small Business study analyzed the small business environment within the 100 most populated U.S. metro areas to assess their friendliness toward employees and job seekers. WalletHub used 11 key metrics ranging from net small business job growth to industry variety to earnings for small business employees.

The top 10 metro areas to work for a small business included:

1. Charlotte, North Carolina;

2. Raleigh, North Carolina;

3. Oklahoma City;

4. Austin, Texas;

5. Omaha, Nebraska;

6. Nashville, Tennessee;

7. Salt Lake City;

8. Dallas;

9. Houston; and

10. Boston.

RALEIGH-DURHAM

The top two markets in WalletHub’s study were both in North Carolina, and David Dombrowski, manager, ARS/Rescue Rooter, Raleigh, North Carolina, said that is for good reason.

“The Raleigh-Durham area is a fantastic place for HVAC contractors if you’re focused on being the best in quality and understanding the real and perceived needs of customers,” said Dombrowski. “This area contains a tremendous amount of diversity in education, cultures, and languages; building types, from single-wide trailers to green housing; equipment with an equal balance of gas, heat pumps, hydro, and packs; and equal heating and cooling seasons. Raleigh-Durham is home to Duke University, the University of North Carolina, N.C. State, and many smaller colleges.”

Andy Curran, field supervisor, Newcomb and Co., Raleigh, North Carolina, has been in the Raleigh area for 17 years, and, much like Dombrowski, also acknowledged the region’s immense diversity as one of its leading characteristics.

“The level of diversity in the region is at the top of the list,” said Curran. “Whether you’re looking to do something in the industrial, commercial, bio-tech, research and development, or retail side of the business, the opportunities are all there. With the Research Triangle Park just north of Raleigh, and affordable land and housing in the surrounding areas, new people constantly come in with fresh new ideas and technologies. The opportunities to merge new ideas from creative minds into what people are already doing in the area are endless.”

Raleigh-Durham’s business acumen is readily apparent. The city also made its way to 106^th place on WalletHub’s list of the best cities to start a business, 36^th on their list of best cities for families, and 18^th in business environment rank.

“The best feature of the area is that people are happy to be here,” said Dombrowski. “They are very community-focused. This blend provides for a true win-win-win situation, because when your customers appreciate service, and your coworkers are working full time with the right focus, the company always wins, both as a professional group and as a corporate citizen. The downside is that if you expect to stay stuck in the non-service-focused mentality of the past, you will fail, and that’s OK with us.”

If there is a real downside to the area, it may come in the form of traffic.

“The traffic in Raleigh can get a little troublesome at times, as the roads have not always been able to keep pace with the area’s growing population,” said Curran. “With the area being as spread out as it is, you can chew up a decent amount of time in traffic throughout the day if your business model is traveling from one site to another. In regard to HVAC, small companies pop up every summer and winter, and they’ll pay higher-than-normal labor wages for their employees just to let them go as the workload slows down. This causes a shortage of labor each busy season, especially for companies that emphasize training and career growth for their employees.”

CHARLOTTE

Charlotte, North Carolina, finished in first place in the study and, similar to Raleigh, excelled in other WalletHub studies conducted in 2015. Charlotte was found to be the 62^nd best city to start a business, and the 55^th best city for a family, and sixth in business environment.

“Charlotte is, indeed, a growing and vibrant city,” said Greg Crumpton, president and founder of Charlotte-based AirTight Facilitech. “The climate of the HVAC market is a tough one, and, like most metropolitan areas, Charlotte has several tiers of contractors ranging from the $150 million crowd through the normalized $3 million to $7 million group all the way down to a plethora of one- and two-man companies.

“As most cities grow, the small business opportunities are realized, and those concerns grow along with the city,” continued Crumpton. “Charlotte is no different. It’s a rising star, and, as anyone would figure, the race is on to become one of the major players in the area. We’re fighting to be the champion in the HVAC piece of this small universe.”

DALLAS

In a 2013 study from Emerson Climate Technologies Inc., North Carolina and Texas again appeared in a list of the top 10 states to work in HVACR.

In speaking to contractors from Texas, the common theme that emerged was the abundance of HVAC opportunities available to those with drive and passion for the industry.

“Texas offers a great climate for the air conditioning business, an infrastructure that is easy to navigate, and customers starving for quality work,” said Paul Sammataro, president, Samm’s Heating and Air Conditioning, Plano, Texas. “The negatives come from the franchise tax, a higher sales tax, and an overpopulation of contractors. There can also be extreme working conditions due to high temperatures.

“I actually relocated my wife and three kids to this area [near Dallas] in 1992 from Boston based on a four-day visit without a job,” continued Sammataro. “That is how impressed we were with the potential of this area. Dallas is full of HVAC business opportunities for those willing to learn, work, and put in the effort. When 2005 arrived, I knew it was time to start my company. Today, 23 years later, moving to Texas was one of the best decisions we made.

SIDEBAR: THE CRITERIA USED

In order to identify the cities that are most and least friendly toward small-business employees, WalletHub assessed the microbusiness environment within the 100 most populated U.S. metropolitan statistical areas (MSAs) across two key dimensions: “Small Business Environment” and “Economic Environment.” WalletHub then identified 11 metrics that are relevant to those dimensions to develop the final rankings. Here is the data set with the corresponding weight for each metric.

Small Business Environment – Total Weight: 10

• Number of small businesses (with fewer than 250 employees per 1,000 inhabitants): full weight;

• Growth in number of small businesses (with fewer than 250 employees): full weight;

• Net small business job growth (number of job gain/loss per number of people employed, for firms with fewer than 250 employees): full weight;

• Industry variety: full weight;

• Percentage of small businesses offering health insurance to employees: half weight;

• Earnings for small business employees (adjusted for cost of living): full weight;

Economic Environment – Total Weight: 5;

• Median annual income (adjusted for cost of living): full weight;

• Unemployment rate: full weight;

• Well-being index: half weight;

• Average number of hours worked: full weight; and

• Population growth (projected population in 2042 vs. 2012): full weight.

According to the U.S. Small Business Administration, small businesses collectively make up 99.7 percent of all U.S. employer firms, employ nearly 49 percent of the private workforce, pay about 42 percent of the private payroll, and created 63 percent of all new jobs added during the past 20 years.

Publication date: 9/14/2015

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