The American spirit of entrepreneurship is alive and well. From bustling coffee shops on your corner to innovative tech startups, small businesses are the backbone of the US economy.
But how many are there exactly? And what impact do they have on the nation’s landscape?
We know these questions can be tempting, and here we are with a guide that answers all of them! Let’s get started.
Contents
– Top Small Businesses Stats
– The Shocking Number of Small Businesses in the US.
– US Small Businesses by Employee Size.
– The Impact of Small Businesses on the US Economy
– How Has the Number of Small Businesses Changed Over the Past Decade?
– What is the US’s Predicted Growth Rate of Small Businesses?
– How Many Jobs Do Small Businesses Create?
– What is the Average Age of a Small Business Owner in the US?
Top Small Businesses Stats (Editor’s Choice)
– 33.3 million small businesses are operating in the US.
– 80% of small businesses, totaling 27.1 million, are operated by a single owner without employees.
– Small businesses contribute 64% of new jobs annually and 44% of the US GDP.
– From 2014 to 2024, small businesses increased by 4.4 million, growing from 28.8 million to 33.2 million, a 15.3% rise.
– Small businesses created approximately 10.5 million net new jobs, while large businesses generated 5.6 million.
– The average age of a small business owner in the United States is around 50, with 30% being 55 or older.
The Shocking Number of Small Businesses in the US (2024)
Get ready to be surprised! As of 2023, a remarkable 33.3 million small businesses operate in the US. That’s right, over 33 MILLION!
This staggering number proves the world is growing with thriving small businesses. The ecosystem is changing, with countless individuals pursuing their dreams and contributing to the nation’s economic well-being.
Source: Nerdwallet
A Look at the Breakdown: US Small Businesses by Employee Size
But this massive figure tells just part of the story. Let’s delve deeper and see how these 33.3 million businesses are distributed based on employee size:
Solopreneurs
Believe it or not, over 80% of small businesses in the US, a staggering 27.1 million, are run by a single owner with no employees.
These solopreneurs, often called “side hustlers” or “freelancers,” are a driving force in the small business landscape.
From freelance writers and graphic designers to local artisans and consultants, this group injects diversity, innovation, and flexibility into the economy.
Source: Forbes Advisor
Small Teams
The next category comprises businesses with 1-4 employees, accounting for a significant portion at 6.2 million.
These small teams often represent businesses in their early stages of growth, transitioning from solo operations to hiring additional staff to keep up with demand.
Growing Businesses
Finally, we have firms with 5-499 employees, rounding out the picture at slightly less than half a million. These growing businesses represent a crucial stage in the small business lifecycle. They have established a strong foundation and are now scaling their operations to meet the needs of a wider market.
| Employee Size | Number of Businesses (Millions) | Percentage |
|---|---|---|
| Solopreneurs (0 employee) | 27.1 | 81.4% |
| Small Teams (1-4 employees) | 6.2 | 18.6% |
| Growing Businesses (5-499 employees) | 0.5 | 1.5% |
| Total | 33.8 | 100% |
Utilizing an SBA business plan writer can help small businesses align with the US Small Business Administration’s standards, increasing their chances of obtaining funding and support.
Beyond Numbers: The Impact of Small Businesses on the US Economy
These 33.3 million businesses are more than just statistics. They are the lifeblood of the US economy, playing a vital role in several areas:
Job Creation Powerhouse: 64% of New Jobs Annually
Small businesses are the champions of job creation in the US. They generate a whopping 64% of new jobs annually. This translates to millions of Americans finding employment opportunities fueled by the entrepreneurial spirit.
Source: Lisa Zhou
| Business | Percentage |
|---|---|
| Large Businesses | 36.0% |
| Small Businesses | 64.0% |
Fueling Economic Activity: A Significant Chunk of the GDP
The economic impact of small businesses goes beyond job creation. They contribute significantly to the US Gross Domestic Product (GDP).
Small businesses account for a remarkable 44% of the US GDP. This highlights their crucial role in driving economic growth and prosperity.
| Business | Percentage |
|---|---|
| Large Businesses | 56.0% |
| Small Businesses | 44.0% |
Source: SBA.gov
How Has the Number of Small Businesses Changed Over the Past Decade (2014-2024)?
Over the past decade, the number of small businesses in the United States has experienced significant growth.
In 2014, there were approximately 28.8 million small businesses. By 2024, this number has risen to about 33.2 million, marking an increase of around 4.4 million businesses, or a growth rate of 15.3% over the decade.
This surge reflects the growing entrepreneurial spirit and the increasing accessibility to resources that support small business creation.
This growth has been influenced by several factors. The proliferation of digital tools and platforms has lowered the barriers to entry for new businesses.
Additionally, there has been an increase in gig and freelance work, contributing to the rise in sole proprietorships and microbusinesses.
However, this period also saw significant challenges, particularly during the COVID-19 pandemic, which forced many businesses to adapt rapidly or close their doors permanently.
Tip: If you want to divert your market to the USA, crafting a detailed immigration business plan is essential for foreign nationals aiming to establish their businesses in the US and contribute to the vibrant small business ecosystem.
| Year | No. of Small Businesses (Millions) |
|---|---|
| 2014 | 28.8 |
| 2024 | 33.2 |
Source: SearchLogistics, Luisa Zhou
Projecting the Future: What is the US’s Predicted Growth Rate of Small Businesses?
Looking ahead, the growth of small businesses in the US is expected to continue, albeit at a potentially moderated pace compared to the past decade.
The Bureau of Labor Statistics (BLS) projects that overall employment in the United States will grow by about 4.7 million jobs from 2022 to 2032, driven largely by small healthcare and social assistance businesses.
While specific projections for the number of small businesses are not always delineated, the continued emphasis on innovation, digital transformation, and the shift towards remote and flexible working environments suggest that small businesses will remain a critical driver of job creation and economic development.
Note: For international entrepreneurs looking to start a business in the US, having an E2 visa business plan is crucial to meet visa requirements and secure their entrepreneurial dreams.
Source: Bureau of Labor Statistics
How Many Jobs Do Small Businesses Create?
Small businesses are a cornerstone of job creation in the United States. They generate about 1.5 million jobs annually, accounting for roughly 64% of new jobs created each year.
From 2000 to 2019, small businesses were responsible for creating approximately 10.5 million net new jobs, compared to 5.6 million by large businesses. This substantial contribution underscores the importance of small businesses not just in employment but also in fostering economic resilience and innovation.
Small businesses are the lifeblood of the US economy, and many entrepreneurs start with the help of a business plan writer to ensure their ventures are well-structured and prepared for success.
Source: SearchLogistics, Luisa Zhou, Oberlo
What is the Average Age of a Small Business Owner in the US?
The average age of a small business owner in the United States is approximately 50. This demographic data indicates that many small business owners are individuals who have accumulated significant professional experience before venturing into entrepreneurship.
Additionally, about 30% of small business owners are aged 55 or older, reflecting a trend where seasoned professionals opt to leverage their expertise and networks to start their own businesses later in their careers
Source: Luisa Zhou, SearchLogistics
Conclusion
The past decade has seen a remarkable rise in the number of small businesses in the United States, growing from 28.8 million in 2014 to an impressive 33.2 million in 2024. This growth reflects the increasing entrepreneurial spirit and the ease with which new businesses can be established, thanks to digital advancements and the gig economy. Despite challenges, including the significant impacts of the COVID-19 pandemic, small businesses have demonstrated resilience and adaptability.
Looking forward, the growth of small businesses is expected to continue, with a particular focus on sectors like healthcare and social assistance. The Bureau of Labor Statistics anticipates overall employment growth, much of which will be driven by small businesses.
Small businesses are crucial to the U.S. economy, not only creating about 1.5 million jobs annually and accounting for 64% of new job creation but also contributing significantly to GDP. They represent a diverse and dynamic segment of the economy, with a majority being solopreneurs who inject innovation and flexibility into the market.
The average age of small business owners, around 50 years, indicates a trend of experienced professionals venturing into entrepreneurship, leveraging their skills and networks to build successful enterprises.
Small businesses are the lifeblood of the U.S. economy, driving job creation, innovation, and economic growth. Their importance cannot be overstated, and their continued support and development are essential for the nation’s sustained economic health and prosperity.
For more statistical article, check out Small Business Revenue.
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