A Lot of New Businesses Forming in Golden State

The hot pace at which California companies are forming this year cooled in the third quarter but still could turn this year into the biggest for new businesses since 1988, an information service reported Thursday.

A total of 11,700 new companies were incorporated in the July-September period, down 4.5% from the second quarter, according to a report Thursday by CDB Infotek, a Santa Ana public records information service.

“The state’s economic growth has slowed somewhat during recent months,” Rick Rozar, CDB’s president, said in prepared remarks explaining the numbers. The third-quarter incorporations were still 5.4% higher than in the same period a year ago, according to the survey.

In Orange County, the 1,179 new business starts during the third quarter were 8.7% lower than the 1,291 starts in the second quarter, and 1.6% below business starts a year ago. The county was the second most fertile ground for creating companies.

In Los Angeles, new incorporations fell 3.3% to 5,086 businesses from 5,261.

Despite the third-quarter slowdown, business growth so far this year has been the strongest this decade.

For the first nine months, a total of 37,793 companies were incorporated, a 4.4% increase over 36,206 new starts for the same period last year. It also marked the highest first-nine-month number since 43,163 businesses incorporated during that period in 1988, CDB Infotek said.

The company compiled its report from U.S. Treasury Department figures. The numbers don’t include limited partnerships and out-of-state companies establishing a formal California presence.