VPR News: Business registrations down in 2007

Business registrations down in 2007

Tuesday, 03/18/08

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(Host) Five-hundred fewer businesses registered with the state of Vermont in 2007 than in previous years.

That's the according to the Secretary of State's Corporations Division, which oversees business registrations. In 2007 just over 9,400 businesses registered, compared to over 9,900 in 2006.

Secretary of State Deb Markowitz says it's too soon to tell if the numbers reflect a downturn in the economy or if the numbers are an anomaly. Markowitz says it's important to take a longer view.

(Markowitz) "A decade ago, 1997, there were 2000 fewer new businesses starting, so between '97 and 2007 we've seen a steady growth of new business in the state. And that overall is a good thing for Vermont."

(Host) However, Markowitz said in the past, business start-ups have been a good indicator of confidence in the business community.

Vermont Chamber of Commerce President Duane Marsh says he's not too alarmed about the numbers and says the drop in business registrations may simple be part of a natural business cycle.

But he says entrepreneurs are closely watching economic indicators.

(Marsh) "I would imagine when they take a look at what's happening nationally, and what's happening with other things here in the state, a lot of people are probably saying, `Gosh, now is not the time for me to start a business.' So I don't think it's a matter of their not wanting to, I think it's a matter of timing."

(Host) The state saw a downturn in the number of new trade names and corporations registered, but the number of Limited Liability Corporations - or LLCs - in the state continued to grow. Markowitz says those numbers are likely caused by changes in the way existing businesses are registered.

(Markowitz) "We're still seeing a conversion to an LLC, so people who may have a corporation or a small business that they've been operating simply with a trade name, are choosing to switch to an LLC because there's tax advantages."

(Host) Vermont also had fewer new non-profits registered in the state last year. Markowitz says it may be an indication of less money being available to starts-up, whether they are non-profit or for-profit entities.

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