California’s a place where people often go in order to chase their dreams. But just as wannabe actors more often wind up waiting tables, it seems California is an iffy place to own a small business, since new stats indicate the state leads the country in terms of small business bankruptcies.
After examining bankruptcy trends dating back to the first quarter of 2009, Equifax concluded that more small businesses declared bankruptcy in the Los Angeles-Long Beach-Glendale, Riverside-San Bernardino-Ontario, and Sacramento-Arden-Arcade-Roseville areas of California than any other regions.
San Diego-Carlsbad-San Marcos, Santa Ana-Anaheim-Irvine, and "California -Rest of State" showed up on a top 15 list, as well.
To be fair to California, though, the list was just based on the total number of bankruptcies, not any sort of percentage of bankruptcies based on the number of local small businesses.
Equifax even explained in a statement, "While California and several Western metro areas continue to report the highest number of small business bankruptcies, other geographic regions experienced unexpected increases in the percentage of filings. In many cases, growth in the bankruptcy rate for these areas outpaced that of major markets such as Los Angeles and Phoenix."
Of course, that’s not exactly good news. It looks like small business owners all over the country may want to be extra cautious for a while.