Check Out These 14 Small Business Stats to Springboard into 2022
Despite the continuation of the COVID-19 pandemic, the small business sector experienced overall growth in 2021. Key small business statistics prove a large portion of small businesses were able to overcome massive economic challenges, serve their communities and contribute to their local economies.
These 14 small business stats exemplify the positive impact small businesses have on the nation and their ability to grow despite adversity.
Key Business Statistics to Know
There are a number of key business statistics compiled by the Small Business Administration that paint a picture of small-business creation and growth.
- In 2021, there were 32.5 million small businesses, which represent a significant 99.9% of US businesses.
- Due to an increase in small businesses, 466,607 new jobs were created.
- In 2019, large banks across the nation issued $87.1 billion in business loans to US businesses with $1 million in revenue or less.
- The top five industries with the greatest number of small businesses are:
- Professional, Scientific and Technical Services
- Other Services (Except Public Administration)
- Real Estate and Rental and Leasing
- Administrative, Support and Waste Management
- Women own 43.1% of businesses in the US, while veterans own 6.6%, Hispanics own 13.3% and racial minorities own 19%.
Small Business Stats: Employees
These entrepreneurs and business owners are responsible for a significant portion of jobs in the US. In fact, small business employment made up 46.8% of all US employees last year. That’s a total of 61.2 million people employed by small businesses, according to the Small Business Administration.
Because small businesses are defined in the US by its number of employees, a small business has fewer than 500 employees, with a majority having fewer than 20 employees.
Small Business Statistics: Generations
Different generations have different goals and mindsets when it comes to business ownership. Here are some descriptive statistics about small business ownership across generations.
- A SalesForce business survey found Millennials and Gen Zers are 188% more likely to create a side business compared to baby boomers, reported dropshipping platform Oberlo.
- SEMRush reported businesses with founders 55 years and older are more likely to survive but less likely to have employees.
- Millennials and Gen Zers are 48% more likely to start a small business or side business because they were passionate about it.
Average Small Business Revenue
A small business’ revenue can range from industry to industry, operation to operation. When thinking about average revenue, here are some key figures:
- According to Fundera, small businesses with no employees have an average small business revenue of $46,978.
- Fundera found 86.3% of small business owners make less than $100,000 per year, with the average small business owner making approximately $71,813 per year in income.
- The biggest challenge a majority of small businesses face is cash flow, SEMRush revealed.
What Percentage of Small Businesses Fail?
Small businesses need time to grow, which directly affects their survival rate. But as that time passes, some businesses thrive, while others shutter. According to data from the Bureau of Labor Statistics, Fundera reported approximately 80% of small businesses survive their first year in business, while 20% of small businesses fail.
Furthermore, approximately 70% of businesses typically survive the second year, while 30% fail.
About 50% of businesses make it to the fifth year and 30% remain in business for 10 years.
But why so many small business failures? Tech market intelligence platform CB Insights found the top reason small businesses fail is that they run out of cash or fail to raise enough capital.
Partner with Extensia
Extensia Financial partners with credit unions and brokers across the country to provide investors and business owners exceptional lending opportunities. We combine our comprehensive portfolio of commercial loan solutions with our diversified expertise to provide tailored strategies that help businesses grow and achieve goals. Contact Extensia today to learn more.
About Extensia Financial
Established in 1998 and headquartered in Simi Valley, CA, Extensia Financial offers competitive commercial real estate loans. We partner with credit unions and connect them to investors across the United States. Additionally, we uniquely support and guide our partners through the entire loan process. Extensia Financial is a proud member of the AVANA Family of Companies.