Local Business Statistics: Jobs, Survival, Ownership, and Industry Mix

Why local business statistics matter

Local business statistics are the fastest way to see how much of the economy is really carried by smaller firms, local employers, and neighborhood-scale operations. They also show where small businesses dominate, where they struggle, and how much they contribute to jobs, payroll, and output.

Table of contents

• How big the local business landscape is
• What small businesses contribute
• What survival and turnover look like
• Ownership patterns in local business data
• Industry and size patterns that shape local economies
• What the data sources can tell you
• How to read these figures for a city or county

How big the local business landscape is

The starting point is scale. In 2023, the U.S. had 8,361,342 business establishments, and 7,152,312 of them had 19 or fewer employees. (Census Bureau Small Business page) That is the core reason local business statistics matter: most establishments are small enough to be shaped by neighborhood traffic, local hiring, and local customer demand.

A few numbers set the frame:

• Small businesses made up 99.9% of all firms. (SBA Frequently Asked Questions About Small Business, 2021)
• Small businesses made up 99.7% of firms with paid employees. (SBA Frequently Asked Questions About Small Business, 2021)
• Small businesses accounted for 97.4% of exporters, or 280,496 firms. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2023, small businesses accounted for 99% of the 5.6 million firms covered under Unemployment Insurance. (BLS The Economics Daily, May 1 2024)
• Small establishments made up over 97% of all establishments in the nation in March 2017. (BLS blog, May 1 2018)

If you are trying to understand a local economy, the headline is not that big firms exist. It is that the base layer of employers, storefronts, contractors, service providers, and independent operators is overwhelmingly small.

What small businesses contribute

The most useful local business statistics are the ones that connect the number of firms to economic output. That is where the scale becomes concrete.

Small businesses employed 46.8% of private sector employees, or 61 million workers. (SBA Frequently Asked Questions About Small Business, 2021) They generated 43.5% of U.S. GDP. (SBA Frequently Asked Questions About Small Business, 2021) They generated 39.7% of private sector payroll. (SBA Frequently Asked Questions About Small Business, 2021) They accounted for 35.6% of private sector receipts, or $13.3 trillion. (SBA Frequently Asked Questions About Small Business, 2021) They accounted for 31.6% of known export value, or $460 billion. (SBA Frequently Asked Questions About Small Business, 2021)

At a glance

Measure	Value	Source
Private sector employees	46.8% or 61 million	SBA Frequently Asked Questions About Small Business, 2021
U.S. GDP	43.5%	SBA Frequently Asked Questions About Small Business, 2021
Private sector payroll	39.7%	SBA Frequently Asked Questions About Small Business, 2021
Private sector receipts	35.6% or $13.3 trillion	SBA Frequently Asked Questions About Small Business, 2021
Known export value	31.6% or $460 billion	SBA Frequently Asked Questions About Small Business, 2021

Those percentages matter because they show that local businesses are not a side category. They are central to jobs, spending, and trade. When local leaders talk about downtown vitality, commercial corridors, or workforce resilience, the numbers point back to small firms as a major engine.

One especially useful comparison is job creation over time. From 1995 to 2020, small businesses created 12.7 million net new jobs, while large businesses created 7.9 million net new jobs. (SBA Frequently Asked Questions About Small Business, 2021) Small businesses accounted for 62% of net new job creation since 1995. (SBA Frequently Asked Questions About Small Business, 2021)

That does not mean every small firm is a job creator every year. It means the cumulative impact of many smaller firms is large enough to dominate the long-run pattern of employment growth.

The BLS data reinforce the same point from a different angle. From 2013 to 2023, small businesses contributed 55% of total net job creation. (BLS The Economics Daily, May 1 2024) Since Q1 2021, small businesses accounted for 53% of 12.2 million total net job creation. (BLS The Economics Daily, May 1 2024) Over the last ten years, small businesses employed an average of 46% of the covered workforce. (BLS The Economics Daily, May 1 2024)

What survival and turnover look like

Local business statistics are not just about openings. They are also about survival, closure, and the long runway it takes to become established.

The turnover figures are sobering:

• In 2019, 1.04 million business establishments opened. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2019, 928,000 business establishments closed. (SBA Frequently Asked Questions About Small Business, 2021)
• About 13% of business establishments are startups. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2019, startup employment averaged 3.3 employees per establishment. (SBA Frequently Asked Questions About Small Business, 2021)
• Average employment at establishments of all ages was 15.3 employees. (SBA Frequently Asked Questions About Small Business, 2021)

The survival rates help put that churn in context. From 1994 to 2019, 67.6% of new employer establishments survived at least two years. (SBA Frequently Asked Questions About Small Business, 2021) The five-year survival rate for new employer establishments was 48.9%. (SBA Frequently Asked Questions About Small Business, 2021) The ten-year survival rate for new employer establishments was 33.6%. (SBA Frequently Asked Questions About Small Business, 2021) The fifteen-year survival rate for new employer establishments was 25.7%. (SBA Frequently Asked Questions About Small Business, 2021)

Survival rates by cohort

Measure	Value	Source
New employer establishments surviving 2 years	67.6%	SBA Frequently Asked Questions About Small Business, 2021
New employer establishments surviving 5 years	48.9%	SBA Frequently Asked Questions About Small Business, 2021
New employer establishments surviving 10 years	33.6%	SBA Frequently Asked Questions About Small Business, 2021
New employer establishments surviving 15 years	25.7%	SBA Frequently Asked Questions About Small Business, 2021

The pattern is clear. Many firms enter the market, but fewer remain over the long term. That is a normal feature of local business ecosystems, not an exception. If you are using local business statistics to judge economic health, you need to separate short-term churn from durable operating capacity.

Survival differs by ownership group

The same dataset shows variation across owner groups. The 2016-2018 two-year survival rate for young employer establishments was 71%. (SBA Frequently Asked Questions About Small Business, 2021) Women-led firms had a 67% two-year survival rate in 2016-2018. (SBA Frequently Asked Questions About Small Business, 2021) Black-led firms had a 65% two-year survival rate in 2016-2018. (SBA Frequently Asked Questions About Small Business, 2021) Hispanic-led firms had a 64% two-year survival rate in 2016-2018. (SBA Frequently Asked Questions About Small Business, 2021) Asian-led firms had a 70% two-year survival rate in 2016-2018. (SBA Frequently Asked Questions About Small Business, 2021)

Those differences matter because they can point to gaps in capital, networks, industry mix, or customer access. They also show why local business support cannot be generic if the goal is to improve outcomes for more than one type of owner.

Ownership patterns in local business data

Ownership is one of the most useful ways to slice local business statistics because it reveals who is starting and scaling firms, and which groups are present in the local economy.

The 2018 data in the source set show several important patterns:

• In 2018, 18.3% of employer firms were minority-owned, totaling about 1 million firms. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2018, 5.8% of employer firms were Hispanic-owned. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2018, 2.2% of employer firms were Black-owned. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2018, 10.1% of employer firms were Asian-owned. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2018, 0.4% of employer firms were American Indian or Alaska Native-owned. (SBA Frequently Asked Questions About Small Business, 2021)
• In 2018, 0.1% of employer firms were Native Hawaiian or other Pacific Islander-owned. (SBA Frequently Asked Questions About Small Business, 2021)
• Women owned 1.1 million employer firms in 2018. (SBA Frequently Asked Questions About Small Business, 2021)
• Women owned 20% of all employer firms in 2018. (SBA Frequently Asked Questions About Small Business, 2021)
• Veterans owned about 338,000 employer firms in 2018. (SBA Frequently Asked Questions About Small Business, 2021)
• Veterans owned 5.9% of all U.S. employer firms in 2018. (SBA Frequently Asked Questions About Small Business, 2021)
• Immigrants owned 18% of employer firms in 2018. (SBA Frequently Asked Questions About Small Business, 2021)

Selected ownership statistics

Group	Measure	Value	Source
Women	Employer firms	1.1 million	SBA Frequently Asked Questions About Small Business, 2021
Women	Share of employer firms	20%	SBA Frequently Asked Questions About Small Business, 2021
Veterans	Employer firms	about 338,000	SBA Frequently Asked Questions About Small Business, 2021
Veterans	Share of employer firms	5.9%	SBA Frequently Asked Questions About Small Business, 2021
Minority-owned	Share of employer firms	18.3%	SBA Frequently Asked Questions About Small Business, 2021
Immigrants	Share of employer firms	18%	SBA Frequently Asked Questions About Small Business, 2021

The ownership picture is even more revealing when you look at industry concentration. Immigrant ownership share was 37% in accommodation and food services. (SBA Frequently Asked Questions About Small Business, 2021) Immigrant ownership share was 24% in retail trade. (SBA Frequently Asked Questions About Small Business, 2021) Management of companies and enterprises had the highest family-owned share at 50%. (SBA Frequently Asked Questions About Small Business, 2021) Utilities had a 47% family-owned share. (SBA Frequently Asked Questions About Small Business, 2021) Health care and social assistance had a 16% family-owned share. (SBA Frequently Asked Questions About Small Business, 2021)

Those figures show that ownership is not evenly distributed across sectors. If you are studying a specific city or county, the local industry mix will strongly affect which ownership groups are most visible in the data.

Industry and size patterns that shape local economies

A local economy is not one number. It is a network of sectors, and the small-business share can vary widely by industry.

The source data provide several useful examples:

• Finance businesses were 99.3% under 500 employees. (SBA Frequently Asked Questions About Small Business, 2021)
• Professional, scientific, and technical services businesses were 99.6% under 500 employees. (SBA Frequently Asked Questions About Small Business, 2021)
• Real estate and rental and leasing had 82% of employment in small establishments. (BLS blog, May 1 2018)
• Construction had 74% of employment in small establishments. (BLS blog, May 1 2018)
• Wholesale trade had 71% of employment in small establishments. (BLS blog, May 1 2018)
• Retail trade had 64% of employment in small establishments. (BLS blog, May 1 2018)
• Services had 59% of employment in small establishments. (BLS blog, May 1 2018)
• Mining had 51% of employment in small establishments. (BLS blog, May 1 2018)
• Finance and insurance had 51% of employment in small establishments. (BLS blog, May 1 2018)
• Transportation and warehousing had 43% of employment in small establishments. (BLS blog, May 1 2018)
• Manufacturing had 36% of employment in small establishments. (BLS blog, May 1 2018)

Industry concentration snapshot

Industry	Small-establishment share	Source
Real estate and rental and leasing	82%	BLS blog, May 1 2018
Construction	74%	BLS blog, May 1 2018
Wholesale trade	71%	BLS blog, May 1 2018
Retail trade	64%	BLS blog, May 1 2018
Services	59%	BLS blog, May 1 2018
Finance and insurance	51%	BLS blog, May 1 2018
Transportation and warehousing	43%	BLS blog, May 1 2018
Manufacturing	36%	BLS blog, May 1 2018

The practical takeaway is simple. A city with a lot of construction, retail, real estate, and service firms will often have a very different local business profile than one dominated by manufacturing or logistics. Local business statistics are most useful when they are paired with sector detail.

The same point applies to firm structure. 86.6% of nonemployer firms were sole proprietorships in 2018. (SBA Frequently Asked Questions About Small Business, 2021) 14% of small employer firms were sole proprietorships in 2018. (SBA Frequently Asked Questions About Small Business, 2021) More than half of small employer firms were S-corporations in 2018. (SBA Frequently Asked Questions About Small Business, 2021) That distinction matters because a solo operator, a small payroll business, and a multi-site firm face very different cash flow and hiring dynamics.

What the data sources can tell you

The source list here is useful because it combines several major data systems. That makes it easier to understand what each statistic is actually measuring.

• SUSB data are available at the U.S. level and by state, MSA, county, and congressional district for 2022. (Census Statistics of U.S. Businesses page)
• SUSB includes number of firms and establishments, employment during the week of March 12, and annual payroll. (Census Statistics of U.S. Businesses page)
• BDS provides annual statistics on gross job gains and losses for the entire economy and by industrial sector and state. (Census small business surveys/programs page)
• BDS has annual statistics since 1976 on the age and size of firms and establishments. (Census small business surveys/programs page)
• QCEW detail is available at the county, metropolitan area, state, and national levels by industry. (BLS blog, May 1 2018)
• Quarterly Census of Employment and Wages covers more than 97% of U.S. jobs. (BLS blog, May 1 2018)
• The Economic Census is conducted every 5 years, for years ending in 2 and 7. (Census 2022 Economic Census about page)

That mix matters because each source answers a different question. If you want establishment counts and payroll, SUSB is the relevant lens. If you want job gains and losses over time, BDS is more suitable. If you want industry-level employment concentration, QCEW is a strong fit. If you want a broad, periodic snapshot across the business economy, the Economic Census fills that role.

Practical reading guide

When you see a local business statistic, ask three things:

1. Is the number about firms, establishments, employees, payroll, or receipts?
2. Is the comparison geographic, industry-based, or ownership-based?
3. Is the statistic a stock measure for one year, or a flow measure over time?

Those questions prevent a lot of common mistakes. A large number of establishments does not always mean a large number of jobs. A high startup count does not necessarily mean high survival. A strong small-business share in one sector does not automatically transfer to the whole local economy.

How to read these figures for a city or county

For local reporting, the strongest use of these statistics is not to repeat them in isolation. It is to connect them to the place you are studying.

A local business profile usually becomes more useful when you combine:

• establishment counts
• employee counts
• payroll levels
• sector mix
• ownership mix
• startup and closure rates
• survival rates
• home-based or sole proprietor activity

The source dataset already points toward this kind of analysis. For example, the U.S. economy is comprised of over 6 million establishments with paid employees. (Census small business surveys/programs page) That broad scale is what gives county, metro, and congressional district data so much value. It lets you move from a national picture to a local one without changing the basic logic of the measure.

If you are evaluating a downtown, a main street corridor, or a countywide development plan, the right question is not whether local businesses are important. The better question is which part of the local business mix is strongest, which groups are underrepresented, and which sectors are most exposed to churn.

That is the real strength of local business statistics. They turn a vague idea about “small business” into a measurable picture of employment, ownership, turnover, and sector concentration.