Editorial corrections verified September 15, 2026. Fixed 2026 edition: CBP 2023, population 2024, and business applications Aug-2025 through Jul-2026.
Delaware ranks first in this index. The top five are Delaware (#1), Mississippi (#2), Tennessee (#3), District of Columbia (#4), Montana (#5). Use this ranking to shortlist places for local research. Its four weighted indicators describe employer establishments, payroll, and business applications; they do not forecast demand, profit, or the best location for your operation.
For Beauty Salons (NAICS 812112), employer-establishment density ranges from 10.3 per 100,000 residents in Mississippi to 39.2 in New Jersey. Beauty Salons is a specific Census category; it does not represent all barber shops, nail salons, or independent booth renters. Payroll covers all employees in this category and is not a stylist wage quote. Density cannot predict how quickly a chair will fill.
The Top 10 States and DC
| Rank | State / DC | Employer establishments | Establishments per 100k residents | Annual payroll per establishment | Annual payroll / March employment | Business applications per 1k residents* |
|---|---|---|---|---|---|---|
| 1 | Delaware* | 277 | 26.3 | $213k | $32,307 | 58.0 |
| 2 | Mississippi | 302 | 10.3 | $125k | $29,754 | 20.9 |
| 3 | Tennessee | 1,062 | 14.7 | $219k | $34,202 | 15.9 |
| 4 | District of Columbia† | 154 | 21.9 | $320k | $46,914 | 22.5 |
| 5 | Montana | 224 | 19.7 | $108k | $31,535 | 28.4 |
| 6 | Kentucky | 680 | 14.8 | $141k | $30,213 | 16.6 |
| 7 | Texas | 5,740 | 18.3 | $174k | $33,591 | 18.8 |
| 8 | Missouri | 1,236 | 19.8 | $163k | $30,947 | 18.5 |
| 9 | Nevada | 656 | 20.1 | $129k | $29,362 | 21.1 |
| 10 | Wyoming* | 127 | 21.6 | $82k | $29,531 | 145.0 |
Deep-dive guides for the leaders: how to start in Delaware · how to start in Mississippi · how to start in Tennessee · how to start in Montana.
How We Ranked the States
We standardize each factor across 50 states and DC using its mean and population standard deviation. The score applies these editorial weights:
- Employer-establishment density (30%, lower scores higher): establishments in NAICS 812112 per 100,000 residents.
- Annual payroll per establishment (25%, higher scores higher): annual industry payroll divided by employer establishments. This can reflect establishment size or pay levels; it is not revenue, profit, or billable work.
- Annual payroll divided by March employment (20%, lower scores higher): annual industry payroll divided by the employee count for the pay period including March 12. It includes part-time employees and all occupations in the category. It is not an occupational wage quote, a full-time-equivalent salary, or a complete hiring cost.
- All-industry business applications per 1,000 residents (25%, higher scores higher): the non-seasonally-adjusted Census BA series for Aug-2025 through Jul-2026, with extreme values capped before scoring. These are business-purpose EIN applications across the covered industries, not completed employer formations, state LLC registrations, or measured growth in this industry.
Formula: score = −0.30 × density z-score + 0.25 × payroll-per-establishment z-score − 0.20 × payroll/employment z-score + 0.25 × capped-application-rate z-score. Density inputs are rounded to two decimals, payroll per establishment to one decimal in thousands of dollars, payroll/employment to whole dollars, and application rates to one decimal before standardizing. Scores are rounded to three decimals and sorted from highest to lowest; rounded ties retain Census state-FIPS order.
Outlier adjustment (*): the lower and upper caps are 11.3 and 28.4 applications per 1,000 residents, selected at sorted positions 3 and 48 of 51 (the floor-index 5th and 95th percentile rule). The lower cap changes Maine, West Virginia; the upper cap changes Delaware, Florida, Wyoming. Tables show the original, uncapped rates. This is a statistical adjustment; the data used here does not establish what caused an extreme value. †DC is a city-scale jurisdiction, so its density and payroll comparisons warrant local interpretation.
These weights have not been validated against business survival or profitability. Payroll contributes to two factors, and the positive payroll-per-establishment factor can favor larger establishments. Different weights can produce different rankings. Census supplies the source data, not the scoring choices or recommendations.
All 50 States and DC, Ranked
An establishment is a business location; a company can operate more than one. CBP covers employers and excludes businesses without paid employees. The table therefore does not count every business or competitor. Dollar figures are nominal historical payroll measures; “k” means thousands of dollars.
| Rank | State / DC | Employer establishments | Establishments per 100k residents | Annual payroll per establishment | Annual payroll / March employment | Business applications per 1k residents* |
|---|---|---|---|---|---|---|
| 1 | Delaware* | 277 | 26.3 | $213k | $32,307 | 58.0 |
| 2 | Mississippi | 302 | 10.3 | $125k | $29,754 | 20.9 |
| 3 | Tennessee | 1,062 | 14.7 | $219k | $34,202 | 15.9 |
| 4 | District of Columbia† | 154 | 21.9 | $320k | $46,914 | 22.5 |
| 5 | Montana | 224 | 19.7 | $108k | $31,535 | 28.4 |
| 6 | Kentucky | 680 | 14.8 | $141k | $30,213 | 16.6 |
| 7 | Texas | 5,740 | 18.3 | $174k | $33,591 | 18.8 |
| 8 | Missouri | 1,236 | 19.8 | $163k | $30,947 | 18.5 |
| 9 | Nevada | 656 | 20.1 | $129k | $29,362 | 21.1 |
| 10 | Wyoming* | 127 | 21.6 | $82k | $29,531 | 145.0 |
| 11 | Alabama | 740 | 14.3 | $153k | $31,754 | 15.0 |
| 12 | Ohio | 2,718 | 22.9 | $177k | $28,476 | 15.5 |
| 13 | Utah | 959 | 27.4 | $112k | $24,906 | 23.8 |
| 14 | New Mexico | 362 | 17.0 | $107k | $29,671 | 20.5 |
| 15 | Louisiana | 699 | 15.2 | $124k | $30,811 | 17.7 |
| 16 | Georgia | 2,563 | 22.9 | $136k | $32,624 | 24.8 |
| 17 | Oklahoma | 675 | 16.5 | $119k | $28,731 | 16.9 |
| 18 | Arizona | 1,711 | 22.6 | $156k | $32,073 | 20.4 |
| 19 | Michigan | 2,170 | 21.4 | $147k | $28,689 | 16.5 |
| 20 | Maryland | 1,481 | 23.6 | $192k | $32,997 | 17.3 |
| 21 | West Virginia* | 277 | 15.7 | $131k | $26,763 | 10.4 |
| 22 | Idaho | 403 | 20.1 | $140k | $30,695 | 18.2 |
| 23 | Arkansas | 453 | 14.7 | $110k | $28,302 | 14.6 |
| 24 | South Dakota | 160 | 17.3 | $162k | $32,892 | 14.3 |
| 25 | Indiana | 1,438 | 20.8 | $153k | $29,745 | 14.2 |
| 26 | Kansas | 654 | 22.0 | $162k | $30,917 | 14.4 |
| 27 | North Carolina | 2,226 | 20.1 | $150k | $34,244 | 17.9 |
| 28 | South Carolina | 1,052 | 19.2 | $141k | $34,816 | 18.7 |
| 29 | Florida* | 7,534 | 32.2 | $116k | $30,808 | 30.3 |
| 30 | Oregon | 800 | 18.7 | $128k | $31,873 | 14.9 |
| 31 | Alaska | 143 | 19.3 | $129k | $34,046 | 17.2 |
| 32 | Illinois | 3,346 | 26.3 | $162k | $32,413 | 15.6 |
| 33 | Minnesota | 1,521 | 26.3 | $182k | $32,951 | 13.2 |
| 34 | Wisconsin | 1,592 | 26.7 | $159k | $30,360 | 13.3 |
| 35 | California | 8,733 | 22.1 | $125k | $32,253 | 15.3 |
| 36 | Colorado | 2,029 | 34.1 | $144k | $36,241 | 27.5 |
| 37 | Connecticut | 1,049 | 28.5 | $173k | $32,933 | 14.8 |
| 38 | Hawaii | 335 | 23.2 | $146k | $33,256 | 12.9 |
| 39 | New Hampshire | 403 | 28.6 | $189k | $35,319 | 14.0 |
| 40 | Virginia | 2,602 | 29.5 | $165k | $35,171 | 16.9 |
| 41 | New Jersey | 3,727 | 39.2 | $160k | $28,151 | 18.2 |
| 42 | Vermont | 144 | 22.2 | $149k | $36,294 | 12.8 |
| 43 | Iowa | 796 | 24.6 | $134k | $32,938 | 11.6 |
| 44 | Maine* | 293 | 20.9 | $158k | $38,640 | 10.7 |
| 45 | Washington | 2,168 | 27.2 | $168k | $40,147 | 14.7 |
| 46 | Pennsylvania | 4,846 | 37.0 | $150k | $28,477 | 12.8 |
| 47 | North Dakota | 240 | 30.1 | $140k | $32,750 | 12.2 |
| 48 | Nebraska | 596 | 29.7 | $123k | $31,269 | 12.1 |
| 49 | New York | 7,124 | 35.9 | $119k | $30,377 | 16.2 |
| 50 | Massachusetts | 2,569 | 36.0 | $180k | $34,428 | 11.9 |
| 51 | Rhode Island | 387 | 34.8 | $105k | $30,849 | 11.3 |
What to Check Before Choosing a Location
Compare local customers and prices, rent, salon and practitioner licensing, staffing or booth-rental arrangements, and your client-acquisition plan.
This index does not include licensing, fees, insurance costs, rent, local demand, profitability, or owner-operated businesses without employees. Low employer density can reflect low demand, geography, or missing nonemployers as well as potential opportunity. State averages cannot settle a neighborhood or service-area decision.
Click a state in the tables for its startup guide. Related research: the overall Best States to Start a Business index and business formation statistics. This page retains its stated data window; the editorial correction date does not mean the inputs were advanced to the latest month.
Considering an LLC for your business?
An LLC is one business-structure option; it is not a universal requirement for starting a salon. A sole proprietorship may also be an option. Choose the structure that fits your circumstances and check operating licenses separately. If you choose an LLC, compare ZenBusiness filing services and current pricing.
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Frequently Asked Questions
Which states rank highest for a salon in this index?
The top five jurisdictions are Delaware (#1), Mississippi (#2), Tennessee (#3), District of Columbia (#4), Montana (#5). This is an editorial screening index built from Census inputs, not a prediction of business success or a Census recommendation.
Which state has the lowest employer-establishment density?
Mississippi has 10.3 employer establishments per 100,000 residents in NAICS 812112, compared with 39.2 in New Jersey. This excludes nonemployers and does not establish which local market has the least competition or the most unmet demand.
Where do the numbers come from?
Census County Business Patterns 2023 supplies establishments, employment, and payroll. Business Formation Statistics supplies all-industry business applications for Aug-2025 through Jul-2026. Population denominators use 2024 Census estimates. The ratios and rankings are our calculations.
Sources
| Data | Source | Vintage |
|---|---|---|
| Employer establishments, employment, payroll | Census County Business Patterns | 2023 |
| Business applications | Census Business Formation Statistics | Aug-2025 through Jul-2026 |
| Population denominators | Census Population Estimates | 2024 |
Definitions: CBP establishments, employment and payroll; BFS applications versus formations; NAICS industry scope. Business structures: SBA launch guidance.