As part of our yearlong project "The State of Small Business," Business News Daily plans to report on the small business environment in every state in America. In this installment, we asked a few of Utah's more than 250,000 small business owners about the challenges and opportunities of operating in their state. Here's what they had to say.
For the most part, business in Utah is booming. A budding tech industry has contributed to the state's remarkably stable economic growth, and a tight-knit community provides unending support for the small business owners of the Beehive State. Like anywhere else, entrepreneurs will naturally find some challenges to contend with, but small business owners are overwhelmingly happy to start and grow their businesses in Utah.
Strong economic growth
Utah's economy is strong by many other states' standards. Since the end of the recession, Utah has trended in the right direction (barring one year of lower growth in 2012) and reached a 3.33 percent GDP growth rate in 2015, nearly a full point higher than the national growth rate that year. Although the specter of the Great Recession still concerns people, the stability is palpable among the entrepreneurial community.
"Because of the steady climb in our economy everybody is getting a little nervous [after] what happened in 2007," Adam Stoker, President and CEO at Relic, said. "But I believe we learn from our mistakes. This growth seems more sustainable and stable than the last recession."
Young tech industry
A major contribution to the growth of Utah's economy is the budding technology community. Silicon Valley is no longer the only game in town, and Utah's happily reaped the rewards of becoming a hotbed of the tech industry. And with the growth of a new industry comes the need for support services and an influx of new dollars into the community.
"In Utah, there is a budding tech community that has created a fantastic spinoff for entrepreneurs," Stoker said. "Major technology companies like Domo began and have grown here in Utah and investors who invested in these companies have done so well with them, they are willing to extend money to other Utah company startups. In essence, entrepreneurs have access to capital when they need it."
"I have heard Utah commonly referred to as the Silicon Slopes," added Wallace T. Davis, president and CEO of background screening company Peopletrail. "This term developed from the many technology companies springing up, while also referencing the mountainous terrain."
Utah's small-business community is strengthened by the support entrepreneurs receive from local communities, both in the way of organizations and customer loyalty. Nearly every entrepreneur Business News Daily spoke with mentioned Utahans' tendencies to support local and regional businesses, and many participated in some sort of development organization.
"From angel organizations to tech startup hubs, development organizations grow and abound in the state," Ben Peterson, CEO and co-founder of BambooHR, said.
"We've had great support from the local university and local schools," said Jerry Hancock, founder and CEO of Sub Zero Ice Cream, which makes frozen desserts using liquid nitrogen. "Being in a university town, we've had the chance to be the subject of many class projects, as well as have the enthusiasm of the students who love the science and uniqueness of our product."
For startups, the support of other entrepreneurs is essential. Eric Clapper, director of business development at lead generation company Badger Maps, said other entrepreneurs have been indispensable in helping them to get off the ground.
"The community of small businesses here has provided much in the way of resources for those of us just starting ours," he said.
Per capita personal income
One way in which Utah struggles is its per capita personal income (PCPI) levels. In 2015, the state ranked 43rd in PCPI, reaching only $39,045, just 82 percent of the national average of $47,669. Real income is flat, said Jonathan Johnson, chariman of Overstock.com, which often means less disposable income circulating throughout the economy.
"Cost of living has increased, along with real estate. However, it does seem to be on par with wages," Hancock added. "It's not the most expensive place to live, but as we look at other markets, it's not the cheapest, either."
Although Utah has a lower cost of living than many states on the coasts, the low PCPI still stands out.
Even as Utah's labor force increased by more than 100,000 workers in the past three years, unemployment has dramatically decreased. Out of the states' 1.5 million workers, only about 55,000 are looking for work. Today, the unemployment rate stands at 3.7 percent, which is a good thing for the state's economy, but it also means hiring is highly competitive.
"Unemployment is low, so finding good employees can be a challenge," Johnson said. "This is particularly true for the tech sector … Competition among employers for tech talent is fierce."
Even so, employers in Utah repeatedly cited the educational environment as a big plus, saying that workers coming out of the Utah higher education system are well prepared to take on work.
"Higher learning has developed a super-supportive ecosystem, helping grow a big tech knowledge base," Peterson said. "These institutions produce people with great work ethic and self-discipline."
Resources for small businesses in Utah
If you're a small business owner in Utah looking for resources to help you move forward, here are a few organizations you might want to learn more about.
SCORE's volunteer business professionals and expert "mentors" give counsel and guidance to entrepreneurs looking to start or expand their businesses. The services are entirely free and volunteer-driven. Here are some of the chapters in Utah.
U.S. Small Business Administration (SBA) District Offices
The U.S. SBA offers financing and grants, as well as consultations and counseling services. There are also opportunities to apply for federal government contracts through the SBA and avenues for obtaining assistance after natural disasters.
Utah Small Business Development Centers
Utah hosts a number of development centers for small business. Each is dedicated to supporting the development and retention of small business, helping entrepreneurs do everything from crafting business plans to navigating the state's tax code. You can find your region's small business development center at the link below.
Are you an entrepreneurial organization or resource for small business owners, but are not listed here? Let us know. Contact the author at email@example.com.