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The best and worst states to start a business

GOBankingRates Logo By John Csiszar of GOBankingRates | Slide 1 of 52

Each state has plusses and minuses for businesses

For many Americans, starting a business is the American dream. In Q2 2017, the U.S. economy expanded at its fastest annual rate since 2015, so now might be a great time to start a business.

Creating a successful company requires much more than just desire and passion, however. You should be aware of the steps to starting a business in your state, including getting a business license. It's also important to know the specific business conditions in your state, ranging from the quality and number of available employees to the tax-friendliness of your location.

To help you understand which states are the best and worst to start a business, GOBankingRates looked at a number of critical factors that shape a business climate. These factors include:

Startup Activity: The rate of new entrepreneurs in every state, the opportunity share of new entrepreneurs (those who started businesses because they saw market opportunities) and the startup density (number of startup firms per 1,000 firm population)

Small Business Employees: The existing number of small businesses and existing number of small business employees in relation to the population — how prominent small businesses are within a state

Survival Rate of Businesses: The ratio of businesses created versus the number of business deaths

Productivity: The per capita real gross domestic product levels in every state

Education Level of Potential Employees: The portion of the population that is graduating from college

Business Tax Climate: How business-friendly the state's tax structure is

Cost of Living: How affordable it is to live in the state

The findings might surprise you — and maybe even inspire you. Whether you're a recent college grad wanting to launch a startup or a retiree ready to make a big move and create a family business, click through to see the best and worst places to start a business, starting with the worst.

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