Best Cities for Small Business in Michigan
Michigan ranks #45 of 50 for small business, with a small business score of 36.9. Troy is its best city for small business at 67.9.
- Michigan, all states
- #45 of 50
- Population
- 87,898
What Small Business Should Know About Michigan
Michigan ranks #45 out of 50 for small business owners and entrepreneurs, presenting some challenges for business formation and growth. The state's fiscal health score of 56/100 is adequate, though fiscal conditions aren't a standout advantage.
Tax policy directly impacts the bottom line. Michigan's overall tax burden is 8.25% of income, with a 6.65% income tax rate that applies to both personal and pass-through business income. The 6% combined sales tax rate is moderate and worth factoring into pricing strategy. The economic environment (score: 22/100) with 5.2% unemployment suggests a larger available workforce, which can ease hiring pressures.
Population is roughly stable, meaning market growth will depend on capturing share rather than riding demographic expansion. Workforce quality may require investment in training — the education score of 42/100 suggests gaps in preparation. A typical home value of $266,292 helps attract and retain employees who can afford to live nearby.
All 24 Cities Ranked for Small Business
| # City | Grade | Small Business score | Overall | Household finances | Economy | Growth | Population |
|---|---|---|---|---|---|---|---|
| 1Troy | A+ | 67.9 | 69.5 | 83 | 76 | 50 | 87,898 |
| 2Rochester Hills | A+ | 67.0 | 68.7 | 83 | 77 | 45 | 77,089 |
| 3Novi | A+ | 66.1 | 68.5 | 79 | 73 | 50 | 66,717 |
| 4Royal Oak | A+ | 65.2 | 68.6 | 73 | 72 | 46 | 57,950 |
| 5Livonia | A | 62.8 | 64.4 | 74 | 68 | 42 | 93,851 |
| 6Farmington Hills | A | 61.9 | 65.8 | 72 | 65 | 41 | 83,515 |
| 7Ann Arbor | A | 54.7 | 64.7 | 32 | 59 | 49 | 122,036 |
| 8St. Clair Shores | B | 54.0 | 57.9 | 57 | 53 | 42 | 58,140 |
| 9Wyoming | B | 53.3 | 55.9 | 53 | 50 | 44 | 77,353 |
| 10Sterling Heights | B | 52.1 | 56.9 | 55 | 47 | 38 | 133,573 |
| 11Kentwood | C+ | 50.8 | 53.8 | 53 | 46 | 41 | 54,296 |
| 12Westland | C+ | 49.3 | 54.1 | 41 | 49 | 42 | 83,633 |
| 13Southfield | C | 48.3 | 51.2 | 51 | 39 | 36 | 76,236 |
| 14Grand Rapids | C | 47.9 | 50.9 | 39 | 43 | 46 | 198,535 |
| 15Dearborn | C+ | 44.9 | 54.8 | 24 | 44 | 35 | 107,423 |
| 16Warren | C | 43.9 | 49.4 | 41 | 34 | 33 | 137,928 |
| 17Dearborn Heights | C | 42.3 | 50.8 | 26 | 39 | 34 | 61,771 |
| 18Taylor | D | 41.5 | 45.3 | 33 | 42 | 37 | 62,081 |
| 19Lansing | D | 40.1 | 45.0 | 27 | 30 | 40 | 113,023 |
| 20Battle Creek | F | 38.6 | 42.3 | 32 | 31 | 30 | 52,374 |
| 21Kalamazoo | F | 35.3 | 40.7 | 17 | 33 | 33 | 73,076 |
| 22Pontiac | F | 29.9 | 38.1 | 14 | 11 | 28 | 62,104 |
| 23Detroit | F | 25.7 | 32.4 | 2 | 2 | 28 | 638,530 |
| 24Flint | F | 23.3 | 32.6 | 1 | 1 | 16 | 80,175 |
City small business scores use each city's own data, with the category weights rescaled over the categories the city has; outdoor access has no city-level measure and is left out.
Compare: States with Similar Small Business Rankings
Also See: Michigan for Other Lifestyles
Frequently Asked Questions
Is Michigan a good state for small business?
Michigan ranks #45 out of 50 for small business with a persona-weighted score of 36.9/100. Its strongest relevant category is Affordability (73/100) and its weakest is Outdoor Access (18/100).
What is the best city for small business in Michigan?
Troy ranks #1 in Michigan for small business with a score of 67.9/100, followed by Rochester Hills and Novi.
What factors are most important for small business in Michigan?
Rankings weighted toward business-friendly tax climate, strong economy, population growth, workforce quality, and transportation infrastructure — what matters when starting or running a small business.