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Calling card of growth: Phone lines point to small business success

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Monday, Oct. 28, 2013
By Xi Chen
Cronkite News

PHOENIX – Purchases of local phone numbers suggest that Arizona is among the five top states for small business growth since the 2008 downturn, according to a recent study.

CallFire, a Santa Monica, Calif.-based communication services company, said Arizona ranked alongside New Jersey, California, Washington and Nevada.

The study looked at the purchase of small business phone numbers from September 2008 through December 2012 in each state except Hawaii and Alaska. Toll-free numbers were excluded.

The five states faring the worst, according to CallFire: North Dakota, West Virginia, South Dakota, Iowa and Mississippi.

“It is not a surprise that Arizona would be on this list because it is consistent with the recovery in Arizona,” said Lee McPheters, director of the JPMorgan Chase Economic Outlook Center at Arizona State University’s W.P. Carey School of Business.

“The state is growing faster than the nation and is growing faster than most other states,” he said.

In addition to the recovery of existing business, McPheters said businesses relocating here and new residents starting businesses are contributing to the recovery.

“We’ve got the added boost of people moving to the state, and lots of people are moving to the state looking to start a business because it’s a very entrepreneurial state,” he said.

Rick Murray, CEO of the Arizona Small Business Association, said the economy forced people to start businesses.

“People couldn’t find jobs anywhere else, so basically they have to create their own jobs,” Murray said.

At the same time, Murray said, a lot of business are being lost.

According to the Small Business Administration, the number of small businesses closing in Arizona was higher than those that opened between 2008 and 2010. During the second quarter of 2011, however, those that opened outpaced those that were closing for the first time since 2008.

“It’s a slow recovery,” Murray said, “I don’t think there is anything that we can stand up and say, ‘Hooray for it.’”

But Murray said a slow recovery is better than a fast recovery because it is easier to sustain the growth.

“Hopefully with the economy improving we’ll see small business start to improve and see more and more become successful,” he said.

Farrell Quinlan, Arizona state director for the National Federation of Independent Business, said that there’s a long way to go and much government should do to promote small business growth. He noted that policies and regulations, including the Affordable Care Act, are making it difficult for owners to invest in small businesses.

“A lot of economic activity is being delayed, waiting to see some of the outcomes of the tax and regulatory policies,” he said.

Quinlan said small businesses drive the economy and deserve support from elected officials.

“Arizona is doing relatively well in that depressed national economy, but I think we could be doing a lot better,” he said.