November Business Formation Report

February 13, 2025 2:12 pm

November saw a 13% drop in business formations from the previous month, with 372,308 new registrations, down 2% year-over-year. While top states like Texas and California held their ground thanks to diverse industries and strong infrastructure, economic uncertainties sent others sliding down the rankings. Inflation, bird flu, and drought continued to challenge struggling states, while post-election uncertainty left some businesses hesitant to take the plunge. With shifting confidence levels, the months ahead will reveal who can keep up the momentum. Our data is sourced from federal and state Corporations Division data and our own research, using rolling 12-month totals and year-over-year comparisons for November 2023 and 2024.

Location New Businesses Nov 2024 New Businesses Oct 2024 % Change Oct 2024 v. Nov 2024 New Businesses Nov 2023 % Change Nov 2023 v. Nov 2024 12 Month Avg. Dec 2023-Nov 2024
Alabama 2526 2918 -13% 3886 -35% 3832
Alaska 820 1021 -20% 830 -1% 982
Arizona 7943 9626 -17% 9639 -18% 10383
Arkansas 2408 2917 -18% 2643 -9% 3023
California 27073 33573 -19% 27591 -2% 34546
Colorado 12583 14208 -11% 12164 3% 13380
Connecticut 3895 4273 -9% 3775 3% 4277
Delaware 22058 25750 -14% 22562 -2% 26032
Florida 42919 47722 -10% 32544 32% 51560
Georgia 16317 18459 -12% 17153 -5% 19164
Hawaii 1734 2067 -16% 1890 -8% 2,056
Idaho 2940 3166 -7% 2981 -1% 3335
Illinois 10900 12273 -11% 11017 -1% 12610
Indiana 6605 7570 -13% 6917 -5% 7658
Iowa 2924 3423 -15% 3429 -15% 3121
Kansas 2164 2728 -21% 2434 -11% 2651
Kentucky 3701 4213 -12% 4103 -10% 4172
Louisiana 3959 4742 -17% 4334 -9% 4865
Maine 1201 1341 -11% 997 20% 1310
Maryland 5485 5178 6% 6901 -21% 7061
Massachusetts 4649 5520 -16% 4580 2% 5437
Michigan 5631 6469 -13% 9797 -43% 10571
Minnesota 5102 5883 -13% 5568 -8% 6268
Mississippi 3310 3707 -11% 2169 53% 3725
Missouri 6852 8082 -15% 6898 -1% 8155
Montana 3995 2445 63% 3766 6% 4299
Nebraska 1452 1854 -22% 1558 -7% 1797
Nevada 4339 5061 -14% 4385 -1% 5068
New Hampshire 1285 1579 -19% 1764 -27% 1682
New Jersey 11831 13419 -12% 11972 -1% 13325
New Mexico 2805 3477 -19% 3259 -14% 3517
New York 18450 20370 -9% 20743 -11% 21062
North Carolina 10750 13237 -19% 11201 -4% 13371
North Dakota 810 635 28% 585 38% 716
Ohio 10518 12134 -13% 10481 0% 12217
Oklahoma 3478 5029 -31% 3254 7% 3925
Oregon 4652 5342 -13% 4512 3% 5269
Pennsylvania 9827 11357 -14% 9866 0% 11292
Rhode Island 950 1050 -10% 870 9% 1081
South Carolina 6068 7194 -16% 6570 -8% 7310
South Dakota 1067 1225 -13% 1066 0% 1186
Tennessee 5161 5955 -13% 5538 -7% 6150
Texas 29717 35319 -16% 30415 -2% 34229
Utah 3897 4432 -12% 6030 -35% 5851
Vermont 516 947 -46% 575 -10% 932
Virginia 8857 10177 -13% 8991 -1% 10414
Washington 7026 8343 -16% 7106 -1% 8760
West Virginia 1229 1479 -17% 1381 -11% 1522
Wisconsin 4212 5073 -17% 4322 -3% 5080
Wyoming 12578 11333 11% 5568 -8% 13554

The Highlights

November brought fewer surprises in the formation rankings as states settled into a rhythm after dealing with months of strikes, hurricanes, and pre-election uncertainty. With Trump’s reelection, a mix of concern and optimism hangs in the air, affecting economic confidence across the country. The top-performing states—California, Texas, and Colorado—continue to thrive, driven by diverse industries, strong talent pools, and favorable geographic advantages. Meanwhile, others are feeling the strain of cyclical problems like drought and other agricultural threats, leading to sharp declines in states like Iowa and Vermont. As the colder months set in and businesses brace for the holiday season, some regions are charging ahead while others hesitate, waiting to see how economic conditions unfold.

Not many surprises at the top: Texas, California, and Colorado continue to dominate, proving once again that varied economies fuel business growth. These states don’t rely on just one industry. Instead, tech, energy, and defense all play major roles, keeping their economies resilient and attractive to new businesses. Booming populations, strong talent pools, and cultural hubs make them magnets for entrepreneurs, while strategic advantages like ports, transportation networks, and access to federal contracts keep the momentum going. And don’t think the cold is slowing down northern states like Maine, Delaware, and North Dakota. They’re holding strong despite the incoming winter chill. Florida and Mississippi are also continuing to make waves this month, rebounding impressively after a rough hurricane season. In Florida especially, once again at the top of our list, businesses are likely racing to rebuild and get high-traffic areas ready for snowbirds and holiday travelers. But the standout this month is North Dakota, which shot up from the bottom to the top of the ranks. No longer content to sit on the sidelines, the state is doubling down on support for entrepreneurs, offering grants for immigrant integration and committing to infrastructure and accessibility improvements to keep business formation on the rise.

We’re also seeing similar patterns repeat in the states that are coming in last. Utah, Michigan, and Alabama are each dealing with familiar hurdles like economic slowdowns and shaky housing markets. But this month, there are a few surprises. Vermont and Iowa both took sharp dives, with Iowa in particular seeing a steep drop after a stronger start earlier this year. As colder weather sets in, Iowa’s agricultural backbone faces threats from drought, bird flu, and seasonal slowdowns, possibly leading many would-be business owners to wait until spring. Vermont, meanwhile, is dealing with rising unemployment and ongoing struggles with statewide childcare availability, making it tougher for entrepreneurs to get new ventures off the ground. Kansas, New Mexico, and Arizona also saw declines, possibly still feeling the effects of prolonged droughts, which can put the brakes on business activity, especially in industries reliant on agriculture and transportation infrastructure.

All in all, November’s rankings reinforce a familiar trend: states with diverse, well-supported industries are holding their ground, while those who have fewer or threatened options are slipping. The key to long-term success lies in adaptability, whether that’s rebounding after natural disasters, investing in infrastructure, or fostering business-friendly policies. As inflation, labor concerns, and seasonal shifts continue to shape the rankings, the states that can strike a balance between stability and growth will be the ones leading the charge into the new year.