How Many Registered Businesses In The Us

A rundown on key facts, numbers and trends regarding entrepreneurship and small concern

American Business is Overwhelmingly Small Business

Based on information from the U.S. Census Bureau, at that place were half dozen.1 1000000 employer firms in the United States in 2019 (latest information).

● Firms with fewer than 500 employees accounted for 99.7% of those businesses.

● Firms with fewer than 100 employees accounted for 98.1%.

● Firms with fewer than 20 employees made up 89.0%.

● Firms with fewer than ten employees accounted for 78.5%.

When nonemployer businesses are taken into account – in that location were 26.v million in 2018 (latest information) – the share of U.Due south. businesses with fewer than 20 workers increases to 98.0% and the share with fewer than 10 employees registers 96.0%.

C-Corps: Amongst employer C corporations in 2018 (latest information):

● 72.5% had fewer than 10 employees

● 84.seven% had fewer than xx employees

● 96.2% fewer than 100

● 98.9% had less than 500 workers.

When nonemployer corporations are taken into business relationship (latest information 2018), firms with fewer than 20 workers represent 89.3% of all C corporations, and the share with fewer than 10 employees registers 80.eight%.

Bulk of Job Cosmos Comes from Small Business

Co-ordinate to the SBA'southward Role of Advancement:

● "Small businesses accept accounted for 62% of net new job creation since 1995. (See the Office of Advocacy's "Ofttimes Asked Questions" publication.)

● "From 2000-2019, small businesses generated about two-thirds of net new jobs. Volatility from the 2020 recession altered long term trends."

● Small businesses apply 46.eight% of private-sector employees.

Also, as noted in SBA's "2020 Small Business Profile":

● Small businesses created i.half-dozen 1000000 net new jobs in 2019, with firms employing fewer than 20 workers generating 1.ane one thousand thousand internet new jobs.

Small Business Share of Employment

According to data from the U.S. Census Agency:

● Employer firms with fewer than 500 workers employed 46.4% of private sector payrolls in 2018.

● Employer firms with fewer than 100 workers employed 32.4%.

● Employer firms with less than 20 workers employed 16.0%.

The Small Business organisation Share of Gdp

According to a study published by the SBA's Office of Advocacy:

"In the 16 years from 1998 to 2014, the small business concern share of GDP fell from 48.0% to 43.5%. The declining modest business share of GDP was non, however, due to a refuse in the level of SGDP [i.e., portion of Gdp produced by minor business]."

As for why the minor business portion declined, it is explained:

"Rising SGDP implies that the refuse in the modest business organization share of Gross domestic product is attributable to faster growth among large businesses. Specifically, later adjusting for inflation, real GDP for big businesses grew at 2.five% annually versus only 1.4% annually for small businesses."

New Business Applications

The U.South. Census Bureau publishes information on new business applications – that is, "business applications for taxation IDs as indicated by applications for an Employer Identification Number (EIN) through filings of IRS Form SS-4" – dating back to July 2004. These numbers are non actual business organisation formations, but instead, a measure of individuals filing for taxation ID numbers. From this data, projections regarding actual futurity business formations are made.

With the onset of the pandemic in 2020, ane of the most encouraging and surprising results was the dramatic leap upward in terms of concern applications. This is encouraging for future growth in entrepreneurship, which is vital to economic recovery and growth.

Total Business organisation Applications Reached Tape Levels: As noted in the following two charts, full business applications and loftier-propensity business applications (that is, businesses nigh probable to have payrolls) both registered record levels in 2021, with full business applications registering 5.four million and high-propensity applications coming in at 1.8 million.

Source: Federal Reserve Bank of St. Louis, FRED

Source: Federal Reserve Banking company of St. Louis, FRED

Pocket-sized Business organisation and Innovation

The SBA's Office of Advancement notes:

"Small businesses represent nearly 96% of employer firms in loftier-patenting manufacturing industries, a percentage that remained constant from 2007 to 2012. However, during the same time period, small businesses' share of employment, payroll, and receipts increased. This increment was especially notable in firms that manufactured computers and peripheral equipment, communications equipment, or semiconductors and other electronic components."

In addition, a 2008 study past Anthony Breitzman and Diana Hicks for the Office of Advocacy("An Analysis of Modest Concern Patents by Industry and Firm Size") found that "small firms are much more probable to develop emerging technologies than are large firms. This is maybe intuitively reasonable given theories on modest firms effecting technological alter, but the quantitative data here support this assertion. Specifically, although small-scale firms account for only 8 percent of patents granted, they business relationship for 24 pct of the patents in the top 100 emerging clusters."

Come across the Office of Advocacy's "Frequently Asked Questions" publication.

Run across"An Analysis of Pocket-sized Business concern Patents by Industry and Firm Size" here.

In a 2013 written report ("Production Innovations past Young and Small Firms") for the SBA's Office of Advocacy, information technology was establish that smaller and younger firms tend to produce greater innovations. It was noted:

"The author generated patent citations per dollar of research and evolution stock for firms of varying sizes and ages. The results for small vs. large firms and young vs. old firms were similar. Small firms averaged 1.2626 patent citations per meg dollars of R&D stock versus 0.5712 for large firms. Young firms averaged 1.2117 patent citations per million dollars of R&D stock, while old firms averaged 0.5344.

"Narrowing the written report focus to young small firms showed them to be highly productive innovators. Firms below the median size (290 employees) and age (18 years) averaged more patent citations per 1000000 dollars of R&D stock than old large firms, 1.7535 versus 0.3424, respectively."

Small Business and Global Trade

Based on data from the latest written report from the U.S. Census Bureau, nosotros encounter the following near the roles small-scale and mid-size businesses played in international merchandise – overall and with the top iii U.S. trading partners (Canada, Mexico and China) – in 2019.

Exporting

• Amidst all identified U.Due south. exporting firms, 76.iii% had fewer than 20 employees, 86.3% fewer than 50 employees, 91.iv% fewer than 100 employees, and 97.4% fewer than 500 employees.

• Among all identified U.South. exporting manufacturing firms, 56.v% had fewer than 20 employees, 74.1% fewer than 50 employees, 84.3% fewer than 100 employees, and 96.1% fewer than 500 employees.

• Among all identified U.S. firms exporting to Canada, 61.7% had fewer than 20 employees, 76.1% fewer than 50 employees, 84.1% fewer than 100 employees, and 94.v% fewer than 500 employees.

• Amid all identified U.S. firms exporting to Mexico, 57.9% had fewer than 20 employees, 71.7% fewer than 50 employees, 80.three% fewer than 100 employees, and 92.ix% fewer than 500 employees.

• Among all identified U.S. firms exporting to China, 53.0% had fewer than 20 employees, 67.6% fewer than 50 employees, 77.2% fewer than 100 employees, and 91.3% fewer than 500 employees.

Importing

• Amongst all identified U.Southward. importing firms, 76.7% had fewer than twenty employees, 86.iv% fewer than l employees, 91.three% fewer than 100 employees, and 97.iii% fewer than 500 employees.

• Among all identified U.Due south. importing manufacturing firms, 49.5% had fewer than 20 employees, 66.1% fewer than 50 employees, 77.v% fewer than 100 employees, and 93.7% fewer than 500 employees.

• Amongst all identified U.S. firms importing from Canada, 43.6% had fewer than twenty employees, 55.five% fewer than 50 employees, 64.9% fewer than 100 employees, and 83.0% fewer than 500 employees.

• Amongst all identified U.S. firms importing from Mexico, 58.6% had fewer than 20 employees, 68.2% fewer than 50 employees, 74.4% fewer than 100 employees, and 86.4% fewer than 500 employees.

• Among all identified U.S. firms importing from Communist china, 74.6% had fewer than 20 employees, 84.viii% fewer than 50 employees, ninety.0% fewer than 100 employees, and 96.6% fewer than 500 employees.

Self-Employed Trending Down

Based on U.S. Bureau of Labor Statistics data (Table A-ix), the level of entrepreneurship in the U.S. actually has declined, or at least stagnated, in recent years. Consider data on the number of self-employed.

Incorporated self-employed:

● Incorporated self-employment fell from 5.78 1000000 in 2008 to 5.xiii 1000000 in 2011.

● Information technology climbed back to v.85 million in 2017.

So, it took nearly nine years for the number of incorporated self-employed to go dorsum to its 2008 level. That was followed by no growth in 2018. But increases in the post-obit two years took the number of incorporated self-employed to vi.28 million in 2020. Nonetheless, the ills of the pandemic showed upwards in this data starting tardily in 2020. The number of incorporated self-employed declined to vi.12 meg in 2021.

Unincorporated cocky-employed:

● The number of unincorporated cocky-employed declined from 10.59 million in 2006 to ix.36 million in 2014.

● Uneven growth resumed, with the level hitting 9.71 million in 2018. However, that was followed by marked declines in 2019 and 2020. The 2020 level of 9.25 million was the lowest since 1983. Growth really resumed, however, in 2021, with the number of unincorporated self-employed reaching 9.96 1000000.

● Starting in July 2021, the seasonally-adapted data on unincorporated self-employed moved about the 10-million marker for the remainder of the year. The last time the 10 meg level had been hit was March 2009.

Incorporated and unincorporated combined data:

● The full number of self-employed (incorporated plus unincorporated) hit sixteen.15 million in 2007, but and so declined for 5 years, registering fourteen.72 one thousand thousand in 2013.

● Some growth resumed, with the total climbing back to 15.72 1000000 in 2019, and then dropping to 15.54 million in 2020. However, growth resumed in 2021, with the total tally coming in at 16.07 million – which unfortunately was still only brusk of the 2007 recent high.

Of course, when considering the increase in population since 2007, stagnation in self-employment becomes a relative decline.

Survival Rate for Pocket-sized Businesses

Co-ordinate to the SBA's Office of Advocacy:

"From 1994-2019, an average of 67.6% of new employer establishments survived at least 2 years. During the same menses, the five-twelvemonth survival charge per unit was 48.9%, the ten-year survival charge per unit was 33.6%, and the 15-yr survival charge per unit was 25.seven%."

On Small Business Financing

According to the SBA'southward Office of Advancement:

• Financing startups: "Startups make heavy utilize of personal equity and traditional debt, with over half using their own personal savings. Demography Bureau data show that employers made greater utilise of financing than did nonemployers, but as well go along to rely on personal savings. Roughly 30% of new nonemployer firms and 7% of employer firms used no startup capital."

• Business concern expansion: "Existing businesses apply like financing vehicles as startups to finance expansion. Personal savings are the most common source of expansion finance, followed by reinvestment of business organisation profits."

See the Part of Advocacy'due south Pocket-sized Business Financing: Frequently Asked Questions

More Details on Small Businesses

According to the SBA'south Office of Advocacy:

Offset-up employment level: "In 2019, startup employment averaged 3.3 employees per establishment. Average employment at establishments of all ages was 15.three employees."

Self-employment by historic period: "According to Census Agency data, the share of self-employed Americans (including incorporated and unincorporated) age xxx or under increased slightly from 6.vii% in 2013 to 7.4% in 2018. During the same time frame, the share of self-employed age 65 and over increased from 14.0% to 16.three%."

Franchises: "In 2017, there were roughly 500,000 franchise establishments with a combined 9.6 million employees."

Family-owned businesses: "Most 29% of employer firms were family-owned in 2018. Family- owned firms employed 10 employees per firm, while not-family- owned firms employed 8 employees per house."

Women-Endemic Firms

According to a March 2021 article by Barbara Weltman:

"According to the 2020 report from National Women'south Business Quango (NWBC) … Women-owned businesses represent 42% of all U.S. businesses (about 13 million), accept ix.four million employees, and $ane.ix trillion in acquirement. Merely nearly 90% of women-endemic businesses had no employees. Nonetheless their revenue topped $229 billion."

The SBA's Office of Advocacy adds:

"Women owned 1.1 million employer firms in 2018, which represented 20 per centum of all employers. Women besides owned 10.six million nonemployer firms in 2017, or 42 percent of all nonemployer firms…"