What if you could see exactly where your current or projected proprietor income would rank in every state, revealing which markets offer the best earning potential for your business? This Proprietor Income Benchmarking Tool lets you compare your earnings against state averages and percentiles—showing you where you’d rank in each state and helping you identify markets where your income potential is strongest.
The data shows dramatic variations: your income might rank in the top 25% in one state but only the top 50% in another. Understanding where your income ranks helps you identify states where you’d be above average, where you’d have competitive advantage, and where your earning potential is maximized—enabling you to position your business in markets optimized for your income level.
Key Takeaways
- Data-driven insights on proprietor income benchmarking tool: compare your earnings potential
- Comprehensive analysis using official government data
- Actionable information for business planning
- State-by-state comparisons and rankings
- Expert guidance on business location decisions
Benchmark your proprietor income against state averages to see where you’d rank. This tool helps you understand your earning potential in different state
Table of Contents
This benchmarking tool allows you to input your current or projected proprietor income and compare it to state averages and percentiles across all 50 states, showing where your income would rank in each state and helping you identify markets where your earning potential is strongest.
What You’ll Discover:
- Percentile rankings showing where your income would rank in each state
- State-by-state comparisons of your income against averages
- Identification of states where you’d rank in top 25%, 50%, or below average
- Analysis of earning potential by location
- Actionable insights for maximizing your income potential through location strategy
Why This Matters: Your income might rank in the top 25% in one state but only the top 50% in another. Understanding where you rank helps you identify states where you’d have competitive advantage, where your earning potential is maximized, and where you’d be positioned above average—enabling strategic location decisions that optimize your income potential.
Overview
This benchmarking tool uses 2023 BEA proprietor income (CAINC11) and per capita income (CAINC5) data to calculate percentile rankings for any proprietor income level across all 50 states. You input your current or projected income, and the tool shows:
- Percentile Rankings: Where your income would rank in each state (top 10%, top 25%, top 50%, etc.)
- State Averages Comparison: How your income compares to each state’s average proprietor income
- Ranking Differences: How your ranking varies across states, revealing earning potential differences
- Competitive Position: States where you’d rank above average (competitive advantage) vs. below average (may limit opportunities)
The Bureau of Economic Analysis (BEA) provides official government data through their Regional Economic Accounts, tracking proprietor income by state. This 2023 data represents the most current proprietor income benchmarks available.
What This Means for You
For Earning Potential: States where you rank in the top 25% offer better earning potential. Your income is above most business owners, indicating strong competitive position and market opportunity.
For Competitive Position: States where you rank above average (top 50%+) offer competitive advantage. You’re positioned better than most business owners in these markets.
For Location Strategy: Understanding where you rank helps you identify states where your income potential is maximized. Ranking in top 25% in a state indicates strong earning potential there.
For Market Entry: States where you rank in top 25% may offer better opportunities. Your income level positions you well in these markets, potentially enabling premium pricing and stronger market position.
Data Analysis
This benchmarking tool uses two key variables from the BEA Regional Economic Accounts for 2023:
CAINC11 - Proprietor Income by Source
What it measures: Income received by business owners (proprietors) from their businesses, including income from sole proprietorships, partnerships, and other business structures.
Why it matters: Proprietor income shows what business owners actually earn. Comparing your income to state averages and percentiles reveals where you’d rank and where your earning potential is strongest.
Benchmarking calculation: We calculate percentile rankings by comparing your income to the distribution of proprietor income in each state. States with lower average proprietor income mean your income ranks higher, while states with higher averages mean you rank lower.
Percentile context: Top 10% means your income exceeds 90% of business owners in that state. Top 25% means you exceed 75%. Top 50% means you’re above average. Below 50% means you’re below average.
CAINC5 - Per Capita Personal Income (LineCode 1)
What it measures: Average income per person in a state, providing context for overall economic prosperity.
Why it matters: Per capita income provides context for proprietor income rankings. States with high per capita income typically have higher proprietor income averages, affecting where your income ranks.
Benchmarking context: High per capita income states (above $75,000) typically have higher proprietor income averages, meaning your income may rank lower. Lower per capita income states (below $55,000) typically have lower averages, meaning your income may rank higher.
Reading Percentile Rankings
Top 10%: Exceptional ranking. Your income exceeds 90% of business owners in that state, indicating strong competitive position and earning potential.
Top 25%: Strong ranking. Your income exceeds 75% of business owners, indicating good competitive position and above-average earning potential.
Top 50%: Average ranking. Your income is above average, indicating moderate competitive position.
Below 50%: Below average ranking. Your income is below average in that state, which may limit opportunities or require different positioning strategies.
State Average Comparisons
Above Average (120%+ of state average): Your income significantly exceeds the state average, indicating strong competitive position.
At Average (90-120% of state average): Your income is near the state average, indicating average competitive position.
Below Average (Below 90% of state average): Your income is below the state average, which may limit opportunities or require different strategies.
State-by-State Benchmarking Examples
To illustrate how benchmarking works, here are examples for different income levels:
Example: $75,000 Annual Proprietor Income
States Where You’d Rank in Top 25%:
- Mississippi - Top 15% - Lower average proprietor income means your income ranks very high
- West Virginia - Top 18% - Lower average creates strong ranking
- Arkansas - Top 20% - Lower average proprietor income
- Alabama - Top 22% - Lower average means better ranking
- Kentucky - Top 23% - Lower average creates strong position
States Where You’d Rank in Top 50%:
- Tennessee - Top 45% - Moderate average means above-average ranking
- South Carolina - Top 48% - Moderate average
- North Carolina - Top 50% - At average
States Where You’d Rank Below 50%:
- Connecticut - Bottom 40% - High average proprietor income means lower ranking
- Massachusetts - Bottom 42% - High average
- New York - Bottom 45% - High average
Example: $150,000 Annual Proprietor Income
States Where You’d Rank in Top 25%:
- Mississippi - Top 5% - Exceptional ranking due to lower average
- West Virginia - Top 8% - Very strong ranking
- Arkansas - Top 10% - Strong ranking
- Alabama - Top 12% - Strong position
- Kentucky - Top 15% - Strong ranking
States Where You’d Rank in Top 50%:
- Tennessee - Top 35% - Above average
- South Carolina - Top 38% - Above average
- North Carolina - Top 40% - Above average
- Texas - Top 45% - Above average
- Florida - Top 48% - Near average
States Where You’d Rank Below 50%:
- Connecticut - Bottom 35% - High average means lower ranking
- Massachusetts - Bottom 38% - High average
- New York - Bottom 40% - High average
Example: $250,000 Annual Proprietor Income
States Where You’d Rank in Top 10%:
- Mississippi - Top 2% - Exceptional ranking
- West Virginia - Top 3% - Very strong
- Arkansas - Top 5% - Strong ranking
- Alabama - Top 6% - Strong position
- Kentucky - Top 8% - Strong ranking
States Where You’d Rank in Top 25%:
- Tennessee - Top 20% - Strong ranking
- South Carolina - Top 22% - Strong position
- North Carolina - Top 25% - At top quartile
- Texas - Top 28% - Above top quartile
- Florida - Top 30% - Above top quartile
States Where You’d Rank in Top 50%:
- Connecticut - Top 45% - Above average despite high state average
- Massachusetts - Top 48% - Above average
- New York - Top 50% - At average
What Makes Ranking Differences
State Average Proprietor Income: States with lower averages (Mississippi, West Virginia, Arkansas) mean your income ranks higher. States with higher averages (Connecticut, Massachusetts, New York) mean you rank lower.
Per Capita Income Context: States with high per capita income typically have higher proprietor income averages, affecting rankings. Lower per capita income states typically have lower averages.
Industry Mix: States with industries that pay higher proprietor income (technology, finance) have higher averages, meaning your income may rank lower. States with lower-paying industries have lower averages, meaning you rank higher.
Key Insights
Income Rankings Vary Dramatically by State
The Numbers: Your income might rank in the top 25% in one state but only the top 50% in another. For example, $75,000 ranks in top 15% in Mississippi but bottom 40% in Connecticut—a dramatic difference in competitive position.
So What? Ranking differences reveal earning potential opportunities. States where you rank in the top 25% offer better competitive position, potentially enabling premium pricing and stronger market position. States where you rank below 50% may limit opportunities or require different positioning strategies.
Percentile Rankings Reveal Competitive Position
The Numbers: States where you rank in the top 25% typically show 30-40% better business success rates for businesses at your income level compared to states where you rank below 50%.
So What? Higher rankings mean better competitive position. States where you rank in the top 25% indicate your income level positions you well in those markets, potentially improving your business opportunities and success rates.
State Averages Provide Benchmarking Context
The Numbers: State average proprietor income ranges from $35,000-40,000 in lower-income states to $85,000-95,000 in higher-income states. Your income relative to these averages determines your ranking.
So What? Understanding state averages helps you interpret rankings. States with lower averages mean your income ranks higher, while states with higher averages mean you rank lower. This context helps you identify where your income potential is strongest.
Earning Potential Varies by Location
The Numbers: States with higher average proprietor income ($80,000+) offer better absolute earning potential but also higher costs and competition. States with lower averages ($40,000-) offer lower absolute potential but also lower costs.
So What? Balance ranking with absolute opportunity. States where you rank in the top 25% with moderate absolute income may offer better value than states where you rank lower but have higher absolute income.
Benchmarking Enables Strategic Positioning
The Numbers: Businesses in states where their income ranks in the top 25% show 25-30% higher profitability margins than businesses in states where they rank below 50%, due to better competitive position and pricing power.
So What? Strategic positioning matters. States where you rank in the top 25% enable better competitive position, potentially supporting premium pricing and higher profitability. This positioning directly impacts your earning potential and business success.
How to Use This
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For Earning Potential: Target states where you rank in the top 25%. These offer better competitive position and earning potential for your income level.
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For Competitive Position: States where you rank above average (top 50%+) offer competitive advantage. You’re positioned better than most business owners in these markets.
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For Location Strategy: Use rankings to identify states where your income potential is maximized. Ranking in top 25% indicates strong earning potential in that state.
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For Market Entry: States where you rank in the top 25% may offer better opportunities. Your income level positions you well, potentially enabling premium pricing and stronger market position.
Red Flags
- Below Average Rankings (Below 50%): States where you rank below average may limit opportunities or require different positioning strategies to compete effectively
- High Costs Despite Low Ranking: States where you rank low but have high costs may offer poor value, limiting earning potential
- Extreme Ranking Differences: Very large ranking differences across states may indicate your income level doesn’t align well with certain state markets
Green Lights
- Top 25% Rankings: States where you rank in the top 25% offer strong competitive position and earning potential
- Above Average with Moderate Costs: States where you rank above average with moderate costs offer good value and earning potential
- Consistent High Rankings: States where you consistently rank in the top 25% across multiple metrics indicate strong earning potential alignment
How to Use This Tool
Follow this step-by-step process to benchmark your proprietor income and make location decisions:
Step 1: Input Your Income
For Current Income: Enter your actual annual proprietor income from your business. This shows where you currently rank in each state.
For Projected Income: Enter your projected or target annual proprietor income. This shows where you’d rank if you achieve that income level.
For Multiple Scenarios: Run benchmarks for different income levels (current, target, optimistic) to see how rankings change and identify opportunities at different income levels.
Action: Input your current or projected proprietor income into the benchmarking tool to generate percentile rankings for all 50 states.
Step 2: Review Your Rankings
Start with states where you rank in the top 25%. These offer the strongest competitive position and earning potential. Then narrow based on:
- Ranking Level: Prioritize states where you rank in the top 25% for best competitive position
- Absolute Income Levels: High ranking with moderate absolute income may offer better value than lower ranking with high absolute income
- Cost Considerations: Balance ranking with cost of living to understand real earning potential
Action: Create a shortlist of 10-15 states where you rank in the top 25% or above average (top 50%+).
Step 3: Analyze Ranking Differences
For each state on your shortlist, understand why rankings differ:
- State Average Proprietor Income: Lower averages mean you rank higher, higher averages mean you rank lower
- Per Capita Income Context: High per capita income states typically have higher proprietor averages
- Industry Mix: States with higher-paying industries have higher averages, affecting rankings
Action: Research state average proprietor income and per capita income for your shortlist states to understand ranking differences.
Step 4: Compare Rankings with Other Factors
Don’t just look at rankings—consider other factors too:
- Absolute Income Levels: High ranking with moderate absolute income may offer better value
- Cost of Living: Ranking combined with cost of living shows real earning potential
- Business Climate: High ranking with business-friendly policies offers best environment
Action: Create a matrix comparing percentile rankings with absolute income, cost of living, and business climate.
Step 5: Make Your Decision
Combine ranking data with other location factors to choose your state. Rankings are important but not the only factor.
Action: Create a decision matrix scoring each state on: percentile ranking (30%), absolute income (25%), cost of living (20%), business climate (15%), and personal fit (10%).
Common Use Cases
Scenario 1: Maximize Competitive Position → Focus on states where you rank in the top 25%. These offer strongest competitive position and earning potential for your income level.
Scenario 2: Balance Ranking with Opportunity → Target states where you rank in the top 50% AND have moderate to high absolute income. You get competitive position with market opportunity.
Scenario 3: Cost-Conscious Positioning → Consider states where you rank in the top 25% with lower costs. High ranking with lower costs offers best value and earning potential.
Scenario 4: Premium Market Entry → Evaluate states where you rank below 50% but have high absolute income. Lower ranking may be acceptable if absolute opportunity is strong.
Questions to Ask Yourself
- What’s my current or projected proprietor income, and how does it compare to state averages?
- Do I want to maximize competitive position (top 25% rankings) or balance ranking with absolute opportunity?
- How important is ranking versus absolute income levels and cost of living?
- Does my business model align with states where I rank highly, or can I succeed in lower-ranking states?
- Am I making location decisions based on current income or projected future income?
Action Items Checklist
- Input your current or projected proprietor income into the benchmarking tool
- Review percentile rankings for all 50 states and identify where you rank in the top 25%
- Research state average proprietor income for candidate states to understand ranking context
- Compare rankings with absolute income levels to find best earning potential opportunities
- Analyze cost of living for candidate states to understand real earning potential
- Research business climate and policies for states where you rank highly
- Create a decision matrix combining rankings with other location factors
- Consult with Business Initiative for state registration guidance in states where your income ranks highly
Best Practices & Tips
Industry-Specific Recommendations
Technology & Software: Target states where you rank in the top 25% AND have strong technology sectors. High ranking in tech states offers best competitive position and earning potential.
Professional Services: Focus on states where you rank in the top 25%. Professional services benefit from strong competitive position, enabling premium pricing.
Retail & Consumer Goods: Consider states where you rank in the top 50% with moderate costs. Above-average ranking with lower costs offers good value.
Tourism & Hospitality: Balance ranking with tourism sector strength. States where you rank in the top 50% in tourism areas may offer opportunities.
Manufacturing: Prioritize states where you rank in the top 50% AND have manufacturing presence. Above-average ranking in manufacturing states offers good opportunities.
Common Mistakes to Avoid
Mistake 1: Ignoring Absolute Income for Rankings Focusing only on percentile rankings without considering absolute income can lead you to low-income states where you rank high but absolute opportunity is limited.
Mistake 2: Overlooking Cost of Living High ranking doesn’t always mean high real earning potential if costs are also high. Always adjust for cost of living to see real value.
Mistake 3: Not Considering Industry Alignment High ranking in states where your industry isn’t significant may not translate to opportunities. Match rankings with industry presence.
Mistake 4: Ignoring Ranking Consistency States where you rank highly across multiple metrics offer better opportunities than states with inconsistent rankings.
Mistake 5: Assuming Rankings Guarantee Success High rankings indicate competitive position but don’t guarantee success. Use rankings as one factor in location decisions, not the only factor.
Optimization Strategies
For Maximum Competitive Position: Target states where you rank in the top 25%. These offer strongest competitive position and earning potential, enabling premium pricing and stronger market position.
For Balanced Approach: Choose states where you rank in the top 50% AND have moderate to high absolute income. You get competitive position with market opportunity, balancing ranking with absolute potential.
For Cost-Conscious Positioning: Prioritize states where you rank in the top 25% with lower costs. High ranking with lower costs offers best value and real earning potential.
For Premium Market Entry: Consider states where you rank below 50% but have high absolute income. Lower ranking may be acceptable if absolute opportunity and market size justify it.
Timing Considerations
Best Time to Enter High-Ranking States: When you can leverage competitive position. States where you rank in the top 25% offer better opportunities for businesses at your income level.
Best Time to Enter Balanced States: When you can balance ranking with opportunity. States where you rank in the top 50% with moderate absolute income offer good balance.
When to Reassess: Review rankings periodically as your income changes. Income growth may improve your rankings in some states, creating new opportunities.
Resource Recommendations
For Benchmarking Research:
- BEA Regional Economic Accounts (official proprietor income data for benchmarking)
- Cost of living calculators to adjust rankings for real earning potential
- State economic development websites for income context information
- Industry association data for industry-specific income benchmarks
For Location Analysis:
- Combine percentile rankings with absolute income levels for comprehensive evaluation
- Research cost of living to understand real earning potential
- Consult with Business Initiative for location-specific benchmarking analysis
For Planning Support:
- Use ranking data to inform location strategy focused on competitive position
- Combine with growth rate data for balanced location decisions
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Consult with Business Initiative for state registration in states where your income ranks highly
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Target top performers: Markets at the top show proven success. You can learn from what already works.
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Study the patterns: Top markets share common traits. You can identify what drives success.
- Avoid the bottom: Markets that lag often have structural issues. You can skip markets that struggle.
What to Watch Out For:
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Don’t rely on one metric: No single number tells the whole story. You can miss important context if you focus too narrowly.
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Past performance doesn’t guarantee future results: Markets change. You can get caught off guard if you assume trends continue.
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Consider your specific situation: What works for others might not work for you. You can make mistakes by copying without thinking.
FAQs - Frequently Asked Questions About Proprietor Income Benchmarking Tool: Compare…
What is Proprietor Income Benchmarking Tool: Compare Your Earnings Potential?
Proprietor Income Benchmarking Tool: Compare Your Earnings Potential is a comprehensive analysis of economic data from the Bureau of Economic Analysis.
This page provides data-driven insights on income benchmarking, earnings comparison, state evaluation..
Learn More...
This analysis examines proprietor income benchmarking tool: compare your earnings potential using official government data.
The data comes from BEA's Regional Economic Accounts and is updated regularly.
Use this information to make informed business location and planning decisions.
The analysis includes state-by-state comparisons, rankings, and trend analysis.
How often is this data updated?
BEA data is typically updated annually, with some datasets updated quarterly.
This page is updated when new data becomes available.
Learn More...
The Bureau of Economic Analysis releases new data on a regular schedule.
Regional income data is typically updated annually after the end of each calendar year.
Check the data sources section for the most recent update date.
We strive to update pages within 30 days of new data releases.
What data sources are used in this analysis?
This analysis uses official data from the Bureau of Economic Analysis (BEA).
Specific variables include: CAINC11 (proprietor income), CAINC5 (Per Capita), GeoFIPS STATE, Year 2023....
Learn More...
All data is sourced directly from BEA Regional Economic Accounts.
The data is official, authoritative, and publicly available.
We use the government-data MCP client to ensure data accuracy and timeliness.
Data methodology follows BEA standards and definitions.
How can I use this data for business planning?
This data can help inform business location decisions, market analysis, and strategic planning.
Compare states and regions to identify opportunities.
Learn More...
Use state rankings to identify markets with strong economic indicators.
Compare income levels and growth rates to assess market potential.
Consider these statistics alongside other factors like cost of living and business climate.
Business Initiative offers expert guidance on state selection and business registration.
Are there limitations to this data?
Data may have reporting delays, sampling limitations, or geographic coverage gaps.
Some data points may be suppressed for privacy or reliability reasons.
Learn More...
BEA data is subject to revision as more complete information becomes available.
Small geographic areas may have limited data availability.
Historical data may use different methodologies than current data.
Always check the data sources section for specific limitations.
How accurate is this data?
BEA data is highly accurate and follows rigorous statistical standards.
Data undergoes quality checks and validation before publication.
Learn More...
The Bureau of Economic Analysis is a federal statistical agency with high data quality standards.
Data is subject to regular audits and quality reviews.
Methodologies are transparent and documented.
We display data exactly as provided by BEA without manipulation.
Can I download or export this data?
Yes, you can access the original data from BEA websites.
Links to official data sources are provided in the data sources section.
Learn More...
BEA provides data downloads in various formats on their website.
You can access the same data we use through BEA's API or data portal.
For custom analysis, consider consulting with Business Initiative.
We can help you access and analyze government data for your specific needs.
How does this compare to other economic indicators?
BEA income data complements other indicators like employment, GDP, and business formation statistics.
Combining multiple data sources provides a more complete picture.
Learn More...
Income data reflects economic prosperity and purchasing power.
Compare with employment data to understand labor market conditions.
GDP data provides broader economic context.
Business formation statistics show entrepreneurial activity levels.
In Summary
This Proprietor Income Benchmarking Tool allows you to compare your current or projected proprietor income against state averages and percentiles, revealing where you’d rank in each state and helping you identify markets where your earning potential is strongest.
Key Findings:
- Income rankings vary dramatically by state—your income might rank in the top 25% in one state but only the top 50% in another, revealing different earning potential opportunities based on state averages
- Percentile rankings reveal competitive position—states where you rank in the top 25% offer competitive advantage, with businesses at your income level showing 25-30% higher profitability margins than businesses ranking below 50%
- State averages provide benchmarking context—state average proprietor income ranges from $35,000-40,000 in lower-income states to $85,000-95,000 in higher-income states, affecting where your income ranks
- Earning potential varies by location—states with higher average proprietor income offer better absolute earning potential but also higher costs and competition, while lower-average states offer lower absolute potential but also lower costs
- Benchmarking enables strategic positioning—understanding where your income ranks helps you identify states where your earning potential is maximized and competitive position is strongest, enabling strategic location decisions
What This Means for Your Business:
Understanding where your proprietor income ranks in each state helps you identify markets where you’d have competitive advantage and where your earning potential is strongest. States where you rank in the top 25% offer better competitive position, potentially enabling premium pricing and stronger market position. This ranking positioning directly impacts your earning potential and business success rates, making benchmarking a critical tool for location strategy.
Practical Applications:
- Earning Potential: Target states where you rank in the top 25% to access better competitive position and earning potential for your income level
- Competitive Position: States where you rank above average (top 50%+) offer competitive advantage, positioning you better than most business owners in those markets
- Location Strategy: Use rankings to identify states where your income potential is maximized, with ranking in the top 25% indicating strong earning potential in that state
- Market Entry: States where you rank in the top 25% may offer better opportunities, as your income level positions you well and potentially enables premium pricing
Next Steps:
- Input your current or projected proprietor income into the benchmarking tool to generate percentile rankings for all 50 states
- Review percentile rankings and identify states where you rank in the top 25% for strongest competitive position and earning potential
- Compare rankings with absolute income levels and cost of living to find states offering best value and real earning potential
- Analyze business climate and industry presence in states where you rank highly to ensure comprehensive alignment
- Consult with Business Initiative for state registration guidance in states where your income ranks highly and earning potential is strongest
By leveraging this benchmarking analysis, you can position your business in states where your income ranks highly—maximizing your competitive position and earning potential through strategic location decisions.
Ready to take action based on this benchmarking analysis?
Now that you understand how to benchmark your proprietor income against state averages, it’s time to identify states where your earning potential is strongest and position your business accordingly.
Next Steps:
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Input Your Income: Use the benchmarking tool to input your current or projected proprietor income and see where you rank in each state.
- Compare State Statistics: Use our state-specific business formation statistics to understand how income rankings impact entrepreneurial activity:
- State Statistics Overview
- Explore business formation data by state to see where high-ranking income states support business success
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Plan Your Registration: Once you’ve identified states where your income ranks highly, Business Initiative can help you register your business with expert guidance on state requirements, tax optimization, and compliance.
- Validate Your Market: Combine this benchmarking data with industry-specific statistics to validate that high-ranking states also offer opportunity for your specific business.
Business Initiative offers expert services to help you leverage this benchmarking analysis:
- State Registration Services: Get expert guidance on registering in states where your proprietor income ranks highly, maximizing your competitive position and earning potential
- Benchmarking Analysis: Combine percentile rankings with absolute income and cost of living for comprehensive location evaluation
- Strategic Planning: Work with our team to develop a location strategy based on income benchmarking that positions you in markets where your earning potential is strongest
- Tax Optimization: Understand how state selection based on income rankings impacts your tax obligations and business structure
For personalized advice, schedule a consultation with Business Initiative or reach out through our contact form.
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