Forbes report: Miami ranked as nation’s riskiest city for small businesses

by | Apr 30, 2024

A Forbes Advisor report ranks Miami as the most challenging city for small business owners in the U.S. due to high operational costs, economic instability, and a volatile labor market.

Miami has been identified as the most challenging environment for small business owners in the U.S., according to a recent Forbes Advisor report.

The analysis, focusing on the 50 largest metropolitan areas, highlighted financial, safety, and workforce-related risks, presenting a daunting landscape for prospective entrepreneurs in Miami.

The city topped the list with a risk score of 100 out of 100, driven by high operational costs, rapid rental price increases, low economic growth, and a volatile labor market, culminating in a convergence of factors that positions Miami as an area where starting a business could be particularly precarious.

Operational costs in Miami were found to be steep, with the city ranking seventh highest in regional price parity. The metric suggests that purchasing power is significantly constrained, affecting the affordability of supplies and equipment essential for business operations. Costs are compounded by a 4.8 percent increase in commercial office rentals from 2022 to 2023, more than three times the study average of 1.3 percent.

Economically, Miami’s outlook presents additional hurdles as the area recorded a GDP growth rate ranked 15th lowest among the studied metros and is projected to see a decline of 2.2 percentage points from the previous year. Analysis within the report suggests that the decline may deter investment and challenge the sustainability of business ventures in the region.

The analysis additionally noted that the workforce in Florida, particularly in Miami, exhibits instability, with a resignation rate of 2.9 percent, one of the highest in the nation.

Adding to Florida’s risky business environment, two other cities in the state were featured report, with Jacksonville and Tampa-St. Petersburg-Clearwater ranking second and third, respectively. Jacksonville, with its high frequency of natural disasters and a higher-than-average cybercrime rate, presents risks, according to the report, while Tampa’s low median household income introduces potential low rates of consumer spending.


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