The Office of Advocacy, an independent division of the U.S Small Business Administration (SBA), recently release the February 2015 edition of their Small Business Profiles for the States and Territories report. The report provides data about the overall U.S. economy, data on U.S. small businesses as a whole, and reports on small businesses in each U.S state, territory, and the District of Columbia.

The report provides interesting statistics on small business activity, including job creation, leading small business industries, small business exporting, and small business demographics. (The report defines a small business as one with fewer than 500 employees.) However, it can be hard to really place all this data in context, as the report mixes economic statistics from 2014, with small business data from 2012, 2013, and in some cases 2007. But with that in mind, here are some noteworthy statistics from the report:

Based on US Bureau of Labor Statistics data:

  • 382,000 new small businesses were started in Q1 2014, and 364,000 closed for a net gain of 18,000 small businesses.
  • In 2013, 630,357 small businesses opened, and 79.5 percent survived through 2014. (That’s 11.8% more than survived from 2010-2012)

According to 2012 data collected in a variety of U.S. Census Bureau studies and surveys:

  • 28.4 million small businesses were operating in the U.S.
  • 56 million people were employed by small businesses in the U.S., accounting for 48.4% of all U.S employment.
  • 20% of small businesses had employees
  • Owners of 80% of small businesses were the only employee
  • Small businesses created 2,175,253 net new jobs in 2012 (The biggest gain was seen in companies with 1-4 employees)
  • The top category for small businesses in the U.S. was “other services” accounting for 4,188,671 businesses in 2012, and 85.8% of all employees in this category. This category was also the leader for small businesses where the owner is the only employee.
  • The top category for small business employers in the U.S. was “Health care & social assistance” which employed 8,451,138 people in 2012 (46% of all employees in that category.)

The report also included a number of top-10 lists, created based on the data presented. According to those rankings:

  • California tops the lists for number of small businesses started in Q1 2014, active small businesses in 2012, number of small business employees in 2012, and number of self-employed people in 2013.
  • Montana has the most small business employees by percentage (68% of the state’s employed in 2012).
  • In Washington state, 87.5% of all small businesses started in 2013 survived to Q1 2014, making it the leader in that category.
  • Washington, DC had the highest self-employed average income in 2013 at $91,644—a good $30,000 better than Massachusetts, which held the #2 spot.
  • Montana and Vermont tied for the highest self-employment rate in 2013, at 13.6%.

The report includes data sheets on each of the U.S states, and the final section provides a combined overview of the territories. The full data used for the study is available for download if you’d like to dig deeper into the numbers.

I did just that to create the graphic at the top of this post, which depicts the top industry category for small business in each state. The following graphs highlight comparisons of other interesting data points. (Click the graphs to see larger versions):

% of Small Businesses Surviving from 2013 to 2014, by State



2012 US Small Business Net Job Gain by State



% of Total 2012 Employment Attributed to Small Business, by State



2013 Number of Self Employed People by State and Gender



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Lisa Hephner

Lisa Hephner

My name is Lisa, and I'm the Vice President of Knowledge, responsible for the management of corporate, product, competitor, marketplace, legal, and regulatory knowledge, and creation and dissemination of knowledge tools using these assets to PaySimple prospects, customers, employees, and partners.

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