Is Delaware Working for Small Business?

By: Kathleen Rutherford, Guest Contributor

Small businesses are not a small part of Delaware’s economy. They are its backbone.

Nearly 29,000 small businesses operate in Delaware, employing more than 250,000 people—more than half of the state’s workforce, according to the Delaware Division of Small Business.

That makes the findings in the Delaware State Chamber of Commerce’s 2026 Competitiveness Bluebookparticularly important.

The Bluebook compares Delaware with other states across more than 60 measures of economic competitiveness. Delaware has important strengths, including its highly regarded judiciary, investment in research and development, and growing innovation economy. But several measures directly affecting small businesses should get policymakers’ attention.

The Cost of Doing Business Matters

Delaware ranks 43rd in the nation for business friendliness and 41st for the cost of doing business, according to the CNBC rankings highlighted in the Bluebook.

For a large corporation, additional costs or regulatory delays may be manageable. For a small business operating on tight margins, they can determine whether an owner hires another employee, expands, invests in new equipment—or decides not to grow at all.

That is why Delaware needs to continue asking a straightforward question: Are we making it easier or harder to start, operate and grow a business here?

Time Is a Cost, Too

Taxes aren’t the only expense businesses face. Time and uncertainty have a price.

Delaware’s permitting process is one clear example. In February, Governor Matt Meyer acknowledged that some state permitting processes can take 18 to 24 months or longer, increasing costs and putting Delaware at a competitive disadvantage.

The Governor’s creation of a Permitting Accelerator is an important recognition of the problem. Now Delaware needs measurable results.

How much have approval times declined? How many projects are moving faster? Are businesses experiencing greater predictability?

Streamlining government does not mean eliminating necessary safeguards. It means establishing clear requirements, coordinating agencies and reaching decisions within reasonable and predictable timelines.

Delaware Also Needs Workers

Small businesses cannot grow without people to fill the jobs they create.

Here, the Bluebook identifies another warning sign. Delaware’s labor-force participation rate declined from 62.27% in 2019 to 59.08% in August 2025—the lowest among neighboring Virginia, Maryland, New Jersey and Pennsylvania. The report also notes that Delaware is now the nation’s fourth-oldest state.

Workforce policy, therefore, cannot be separated from economic policy. Housing affordability, education and skills training, energy costs and quality of life all influence whether working-age people choose to build their careers and families here.

And when Delaware struggles to attract workers, small businesses feel it first.

Give Small Businesses Room to Grow

Delaware has considerable advantages. More than 2.28 million legal entities are incorporated or formed here, and more than two-thirds of Fortune 500 companies call Delaware their corporate home.

But being the legal home of American business should go hand-in-hand with being a great place to actually operate a business.

That means lowering unnecessary barriers, speeding up permitting, keeping the cost of doing business competitive and creating an environment where entrepreneurs have the confidence to invest and grow.

Delaware can do better.

The goal should not simply be improving a ranking. It should be creating a state where the person opening a restaurant, expanding a construction company, running a neighborhood retailer or launching the next Delaware startup has every opportunity to succeed.

Kathleen Rutherford is a government relations and advocacy professional with experience in lobbying, public policy and strategic communications in Delaware and Washington, D.C.