If you are a small business owner in the United States you are in good company. According to the United States Small Business Administration, there are 32.5 million small businesses that employ over 61.2 million employees. Small businesses (firms that employ fewer workers than the average for their respective industry) make up 99.9% of all private companies in the U.S.
Small businesses may abound, but they’re not always built to last. In fact, nearly half of them fail after five years, making it important to study the statistics from the current environment to avoid making mistakes. We’re sharing 57 must-know small business statistics that can help you make better decisions for your business in 2020.
Small Business Statistics
Small Business Failure Statistics
Small Business Survival Statistics
Small Business Lending Statistics
Small Business Employer Statistics
Gig Economy Statistics
Remote Working Statistics
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Small Business Statistics
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There are 30.7 million small businesses in the United States.
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There are 59.9 million small business employees in the United States.
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Most small businesses are made up of fewer than 100 employees.
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Miami, New York, and Portland are the best places to start a small business.
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33% of small business owners report that cash flow is the number one challenge.
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The largest percentage of small business owners are between ages 50–59.
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Most business owners pursue entrepreneurship to be their own boss.
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According to the Small Business Administration, a small business is a firm with fewer than the average number of employees for the respective industry.
SBA
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50% of all small businesses are home-based.
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Almost 20% of small businesses are family-owned.
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64% of small business owners structure their company for liability and taxes.
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The majority of small businesses start with $10,000 or less.
Failure Statistics
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50% of small businesses fail after five years.
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65% of small businesses fail after ten years.
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90% of startups eventually fail.
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82% of small businesses fail because of cash flow problems.
U.S. Bank
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Mining, quarrying, and oil and gas extraction small businesses have the worst five year survival rate.
Survival Statistics
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69% of small businesses survive after two years.
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80% of small businesses survive after one year.
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Agriculture, forestry, fishing, and hunting small businesses have the best five year survival rate.
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The average age of entrepreneurs with a small business that survived is 42.
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The key to the survival of a small business is generating new clients.
Small Business Lending Statistics
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Loans, lines of credit, and credit cards are the most common types of external financing for small businesses.
FSB
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43% of small businesses applied for financing in 2018.
FSB
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21% of small businesses owe between $25K–$100K in debt.
FSB
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Nearly half of first-time applicants were granted full funding.
FSB
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Medium/high credit risk applicants are more likely to borrow from online lenders.
FSB
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70% of small businesses have outstanding debt.
FSB
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One in five medium/high risk applicants sought financing from other sources.
FSB
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86% of owners rely on their personal credit rather than business credit.
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Small Business Employer Statistics
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In the U.S. there are 1.1 million women-owned small businesses.
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In the U.S. there are 1.1 million minority-owned small businesses.
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Alaska has the most women-owned small businesses with 26%.
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Hawaii has the most minority-owned businesses at 61%.
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73% of small business owners identify as male.
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25% of small business owners identify as female.
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6.8% of small businesses have an owner who is a veteran.
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67% of small business owners graduated with a college degree.
Gig Economy Statistics
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One in ten workers claim gig work as their primary income.
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40% of U.S. gig workers bring home more than $100,000 per year.
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In 2019, gig workers earned a combined $1 trillion.
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38.4% sought out gig work because of the flexible schedule.
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57 million Americans claimed to work a freelance gig in 2019.
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Nearly 50% of gig workers are under the age of 30.
Payoneer
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The average hourly rate of gig workers is $19.
Payoneer
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78.6% of gig workers sourced their jobs online.
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Almost half of all gig workers work 30-50 hours per week.
Payoneer
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By 2027, more than 50% of the U.S. workforce will freelance for a living.
Forbes
Remote Working Statistics
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90% of employees say more flexible work opportunities increase morale.
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65% of workers claim they are more productive when working from home.
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Remote workers make $4,000 more than traditional workers.
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41% of companies around the world offer some type of remote working opportunities.
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The current number of remote workers effectively takes 600,000 cars off the road.
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4.7 million employees now work from home at least half the time.
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16–24 year-old remote workers earn an average of $30,108 per year.
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25–34 year-old remote workers earn an average of $42,380 per year.
From the numbers it is easy to see that the U.S. economy depends on small businesses for employment and services. If you are an owner of one of these core parts of our economy, use these statistics to make decisions that may maximize profits, help grow your company, and improve the lives of your employees.
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