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Small business statistics for every state

  • Small business statistics for every state

    Small businesses truly are the backbone of the U.S. economy, employing millions of workers, offering opportunities to marginalized communities, and fueling trade and economic energy.

    The economic impact of COVID-19 on American small businesses may lead to the end of many jobs that support families and children, result in a disastrous drop in tax coffers, and wield an incalculable blow to creativity and entrepreneurship.

    Tens of thousands of small businesses have shuttered as states have tried to protect against the spread of COVID-19, especially in industries of hospitality, tourism, retail, and personal care. Most of them, experts say, may stay closed for good.

    Despite taking advantage of such options as the government's Paycheck Protection Plan to pay salaries and wages, many small businesses say they will be laying off and furloughing workers as the federal funds are spent. About half have said they will need more financial support to stay afloat.

    The end of the year, typically a time for small businesses to thrive on holiday sales, in 2020 offers little good cheer. Over 20% of small businesses say their sales levels are still less than half of what they were before the public health crisis. More than half say business is not likely to return to pre-pandemic levels until next year, although a fifth of small business owners are even more pessimistic and fear it will take until 2022.

    UpCounsel took a look at small businesses and how they are faring around the country, using data from the U.S. Small Business Administration Office of Advocacy's 2020 Small Business Profiles and Kauffman's 2019 Indicators of Entrepreneurship to compile small business statistics for every state. Each slide contains information on how many small businesses exist in the state, how many employees are working in these businesses, and statistics on the success of new businesses and entrepreneurs.

  • Alabama

    - Small businesses in the state: 401,717 (99.4% of all businesses)
    - Small business employment: 802,920 (47.5% of all employees)
    - New employer businesses per 100 people: 0.09 (23,841 net new jobs)
    - Average startup early job creation: 4.69 (#26 highest of all states)
    - Self-employed minorities: 46,916 (#24 highest of all states)
    - Startup one-year survival rate: 81.5%
    - Rate of new employer business actualization: 9.9%
    - Rate of new entrepreneurs: 0.2%
    - Opportunity share of new entrepreneurs: 89.7%
    - Small business exporters: 3,386

    About four out of five small businesses in Alabama say they have had shortages or shipping delays due to the coronavirus, a recent survey showed, and more than half said they would need financial relief to recover from the economic impact of the pandemic. Over the summer, the state announced a "Revive Alabama" grant program to reimburse small businesses for expenses attributable to the outbreak.

  • Alaska

    - Small businesses in the state: 73,298 (99.1% of all businesses)
    - Small business employment: 137,271 (52.4% of all employees)
    - New employer businesses per 100 people: 0.17 (2,277 net new jobs)
    - Average startup early job creation: 3.47 (#49 highest of all states)
    - Self-employed minorities: 10,413 (#40 highest of all states)
    - Startup one-year survival rate: 81.8%
    - Rate of new employer business actualization: 13.6%
    - Rate of new entrepreneurs: 0.4%
    - Opportunity share of new entrepreneurs: 85.3%
    - Small business exporters: 587

    More than a third of business owners in Anchorage have said COVID-19 put them at risk of closing, possibly forever, according to a local survey. More than 7,000 small businesses in Alaska took advantage of the federal government's Paycheck Protection Program that offered forgivable loans to cover payroll expenses. The state also decided to distribute $290 million in federal assistance as grants to small businesses, many of which have been hit especially hard by the loss of tourism revenue.

  • Arizona

    - Small businesses in the state: 592,485 (99.4% of all businesses)
    - Small business employment: 1.1 million (43.5% of all employees)
    - New employer businesses per 100 people: 0.10 (44,301 net new jobs)
    - Average startup early job creation: 4.49 (#29 highest of all states)
    - Self-employed minorities: 122,590 (#8 highest of all states)
    - Startup one-year survival rate: 77.9%
    - Rate of new employer business actualization: 10.0%
    - Rate of new entrepreneurs: 0.3%
    - Opportunity share of new entrepreneurs: 87.8%
    - Small business exporters: 6,742

    Small businesses employ more than 1 million people in Arizona and last year created more than 44,000 jobs in the state. In recent years, small businesses have benefited from Arizona being one of the fastest-growing state economies in the country, driven in large part by population migration to the desert state.

  • Arkansas

    - Small businesses in the state: 255,004 (99.3% of all businesses)
    - Small business employment: 490,680 (47.6% of all employees)
    - New employer businesses per 100 people: 0.10 (10,151 net new jobs)
    - Average startup early job creation: 4.32 (#32 highest of all states)
    - Self-employed minorities: 25,654 (#32 highest of all states)
    - Startup one-year survival rate: 78.0%
    - Rate of new employer business actualization: 12.5%
    - Rate of new entrepreneurs: 0.3%
    - Opportunity share of new entrepreneurs: 86.8%
    - Small business exporters: 1,780

    Arkansas has been ranked among the top states for starting a small business. Its industries include lumber, tourism, poultry, rice production, natural gas, and oil production. Nearly 1,800 small businesses exported goods from Arkansas in 2018, the most recent figure available, generating almost a fifth of the state's $5.5 billion in exports.

  • California

    - Small businesses in the state: 4.1 million (99.8% of all businesses)
    - Small business employment: 7.2 million (48.5% of all employees)
    - New employer businesses per 100 people: 0.14 (214,569 net new jobs)
    - Average startup early job creation: 6.34 (#7 highest of all states)
    - Self-employed minorities: 1.2 million (#1 highest of all states)
    - Startup one-year survival rate: 81.3%
    - Rate of new employer business actualization: 15.6%
    - Rate of new entrepreneurs: 0.4%
    - Opportunity share of new entrepreneurs: 87.4%
    - Small business exporters: 68,022

    In California, small businesses employed nearly half of all workers in the state, although those figures are in flux due to the economic impact of the coronavirus. In 2019, of the 214,569 jobs created by small businesses in California, companies with fewer than 20 employees created 147,780 jobs.

  • Colorado

    - Small businesses in the state: 653,639 (99.5% of all businesses)
    - Small business employment: 1.1 million (48.1% of all employees)
    - New employer businesses per 100 people: 0.17 (33,618 net new jobs)
    - Average startup early job creation: 6.64 (#3 highest of all states)
    - Self-employed minorities: 72,132 (#13 highest of all states)
    - Startup one-year survival rate: 78.7%
    - Rate of new employer business actualization: 11.1%
    - Rate of new entrepreneurs: 0.3%
    - Opportunity share of new entrepreneurs: 85.4%
    - Small business exporters: 5,105

    More than 100,000 small businesses in Colorado signed up with the federal government's Paycheck Protection Program, borrowing $10.4 billion to help cover payroll costs after COVID-19 broke out in March. For nearly four out of five small businesses, the loans amounted to less than $150,000. The state also launched an "Energize Colorado Gap Fund" to provide more than $25 million in loans and grants for small businesses with fewer than 25 employees.

  • Connecticut

    - Small businesses in the state: 350,376 (99.4% of all businesses)
    - Small business employment: 745,085 (48.5% of all employees)
    - New employer businesses per 100 people: 0.09 (972 net new jobs)
    - Average startup early job creation: 3.78 (#43 highest of all states)
    - Self-employed minorities: 43,867 (#25 highest of all states)
    - Startup one-year survival rate: 69.4%
    - Rate of new employer business actualization: 9.5%
    - Rate of new entrepreneurs: 0.2%
    - Opportunity share of new entrepreneurs: 75.1%
    - Small business exporters: 5,057

    Some 3,700 small businesses in Connecticut have been forced to shut down by the economic impact of COVID-19, according to recent figures by the secretary of the state. Less than half of the state's small businesses say they expect to make a profit this year, and more than half said they had cut hours and laid off or furloughed employees due to the coronavirus, according to a business association survey.

  • Delaware

    - Small businesses in the state: 84,675 (98.4% of all businesses)
    - Small business employment: 187,221 (46.7% of all employees)
    - New employer businesses per 100 people: 0.18 (4,776 net new jobs)
    - Average startup early job creation: 4.90 (#21 highest of all states)
    - Self-employed minorities: 11,944 (#37 highest of all states)
    - Startup one-year survival rate: 78.8%
    - Rate of new employer business actualization: 6.6%
    - Rate of new entrepreneurs: 0.3%
    - Opportunity share of new entrepreneurs: 89.0%
    - Small business exporters: 1,909

    In Delaware, small businesses can tap into a $100 million grant program to help with the impact of COVID-19. The program offers grants of up to $100,000 to pay for buying equipment to make the workplace safe such as PPE, Plexiglass, air purifiers, and other expenses brought on by COVID-19. Among the initial applications, food services, retail establishments, and personal care facilities dominated the industries seeking help. More than half were women- or minority-owned businesses. Three-quarters were businesses with revenues of less than $1 million a year and fewer than 10 employees.

  • Florida

    - Small businesses in the state: 2.7 million (99.8% of all businesses)
    - Small business employment: 3.5 million (41.7% of all employees)
    - New employer businesses per 100 people: 0.16 (133,441 net new jobs)
    - Average startup early job creation: 6.37 (#5 highest of all states)
    - Self-employed minorities: 527,247 (#2 highest of all states)
    - Startup one-year survival rate: 77.9%
    - Rate of new employer business actualization: 8.7%
    - Rate of new entrepreneurs: 0.5%
    - Opportunity share of new entrepreneurs: 88.3%
    - Small business exporters: 55,648

    Small businesses start and fail at an active pace in Florida. At the end of 2018, almost 22,000 businesses started up, creating over 79,000 jobs. At the same time, more than 18,000 businesses closed, with a loss of more than 68,000 jobs. During the COVID-19 pandemic, small businesses in Florida have been hard hit by a drop in tourism.

  • Georgia

    - Small businesses in the state: 1.1 million (99.6% of all businesses)
    - Small business employment: 1.7 million (43.1% of all employees)
    - New employer businesses per 100 people: 0.12 (64,905 net new jobs)
    - Average startup early job creation: 5.84 (#9 highest of all states)
    - Self-employed minorities: 202,769 (#4 highest of all states)
    - Startup one-year survival rate: 75.6%
    - Rate of new employer business actualization: 7.8%
    - Rate of new entrepreneurs: 0.4%
    - Opportunity share of new entrepreneurs: 88.4%
    - Small business exporters: 13,195

    Georgia was one of the first states to reopen its businesses during the pandemic, a decision made by the governor in late April. A survey taken the following month found that most small businesses felt a drop in revenues, but few thought the damage would last long. Nearly two-thirds say they expected business to return to normal within six months, and a mere 4% said they thought business would never recover.

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