Small businesses remain the heart of the U.S. economy in 2025. This statistics roundup compiles the latest government and industry data to provide a clear snapshot of how America’s 36 million small firms are performing. A small business is an independently owned and operated company that employs fewer than 500 people or generates annual revenue below industry-specific thresholds set by the U.S. Small Business Administration. 

Small Business Growth

1. 36.2 million small businesses operate in the United States as of 2025 (SBA Office of Advocacy, 2025 Small Business Profile).
2. Small businesses represent 99.9% of all U.S. businesses (SBA Office of Advocacy, 2025).
3. 29.8 million nonemployer businesses (sole proprietorships) without paid employees operated in 2022 (U.S. Census Bureau, Nonemployer Statistics, 2025).
4. 5.52 million employer firms with 1-499 employees operated in 2022 (U.S. Census Bureau, Statistics of U.S. Businesses, 2025).

Small Business Employment Impact

5. Small businesses employ 62.3 million Americans, representing 45.9% of all U.S. employees.
6. Small businesses contributed 1.2 million net job increases, representing 88.9% of total net job creation between March 2023-March 2024.
7. Small business employment grew 13.1% between 1998-2022, reaching 62.3 million employees.

Small Business Demographics & Ownership

Women-Owned Small Businesses

8. Women own approximately 43-47% of all small businesses while representing 46.9% of the workforce.
9. 12.7 million women-owned nonemployer businesses generated $411.6 billion in receipts in 2022 (U.S. Census Bureau, Nonemployer Statistics by Demographics, 2025).
10. Approximately 1.1 million women-owned employer businesses operated in 2022 (U.S. Census Bureau, Annual Business Survey, 2025).

Minority-Owned Small Businesses

11. Hispanic-owned businesses: 16.5% of business ownership vs. 18.1% of workforce (SBA Office of Advocacy, 2025).
12. Asian-owned businesses: 650,680 employer firms plus 2.79 million nonemployer businesses (U.S. Census Bureau, 2025).
13. Black/African American-owned businesses: 194,585 employer firms plus 4.44 million nonemployer businesses (U.S. Census Bureau, 2025).

Geographic Distribution

14. Rural small businesses: 5.43 million total (4.61 million nonemployer + 820,280 employer).
15. Urban small businesses: 27.2 million total (22.5 million nonemployer + 4.72 million employer).

Small Business Industry Distribution

16. Professional, Scientific, and Technical Services lead with 4.88 million small businesses.
17. Transportation and Warehousing: 4.09 million small businesses.
18. Other Services: 3.86 million small businesses.
19. Construction: 3.66 million small businesses.

State Trends in Business Formation & Resilience

20. Business formations have skyrocketed nationwide, reaching a record 478,800 per month in 2025—a rise of over 435% since 2004, when monthly formations averaged less than 90,000.
21. Washington experienced the highest recent growth: +78.4% in new formations (14,495 per month).
22. Other notable states with high formation growth include Montana (+28.6%), Oregon (+26.8%), Wyoming (+23.7%), and Alaska (+23.5%).
23. The overall number of business bankruptcies dropped from 35,998 in 2004 to just 19,251 in 2023, while formations rose from 1,074,739 to 5,461,471 annually.
24. States such as Wyoming now see over 2,500 new business formations for every bankruptcy, exemplifying strong resilience (Wyoming: 59,236 formations vs. 23 bankruptcies).
25. Nationally, bankruptcies have fallen almost 74% since 2004, marking a major improvement in business survival and confidence.
    

Small Business Financial Performance

Small Business Loans

26. $84.2 billion in new small business loans issued by reporting banks to businesses with revenues under $1 million in 2023.
27. $242.9 billion total reported new lending to businesses through loans of $1 million or less.
28. Small business loan approval rates varied by lender type: Small banks (52%), Credit unions (51%), Finance companies (51%), Large banks (44%), Online lenders (31%).

Small Business Debt and Risk

Small Business Debt Levels and Burden

29. 39% of small businesses carry debt exceeding $100,000, remaining higher than prepandemic levels.
30. Average SBA loan amount: $479,685 in 2023 according to Lendio data.
31. 56% of small businesses seeking funding do so to meet operating expenses.

Financial Challenges and Risk Factors 

32. 75% of firms cite rising costs of goods, services, and/or wages as their primary financial challenge .
33. 56% report challenges paying operating expenses.
34. 51% struggle with uneven cash flows.
35. 64% of Third District firms reported poor or fair financial conditions in 2024, up from 58% in 2023.
36. Revenue performance index declined for the second consecutive survey cycle as sales challenges persisted.
37. For the first time since 2021, more firms reported revenue decreases than increases in the prior 12 months.

Small Business Cash Flow Management

Cash Flow Challenges

38. Uneven cash flows affect 51% of small businesses, making it the third most common financial challenge.
39. More firms carried debt and reported issues with paying operating expenses in 2024 vs. 2023.
40. 57% of firms reported difficulty reaching customers and growing sales as their top operational challenge, up from 53% in 2023.
41. Reaching customers and growing sales was the most commonly reported operational challenge affecting revenue generation.

Credit and Working Capital

42. Application rates for financing remained stable year-over-year in the 2024 survey.
43. 46% of firms seeking funding aimed to expand business, pursue new opportunities, or acquire business assets.

Small Business Dynamics

Establishment Activity

44. 1.28 million establishments opened vs. 1.13 million that closed between March 2023-March 2024.
45. Small businesses accounted for 1.1 million openings and 982,940 closings during this period.
46. Employment expanded at 2.1 million establishments and contracted at 2.0 million.

Export Activity

47. 270,014 small firms exported goods worth $588.4 billion in 2023, representing 97.2% of all exporting firms.
48. Small firm exports comprised 33.0% of total exports by identified firms.

Small Business Employment Characteristics

Industry Employment Distribution

49. Professional, Scientific, and Technical Services employ 5.62 million people at small businesses.
50. Construction small businesses employ 5.94 million people.
51. Health Care and Social Assistance small businesses employ 9.26 million people.
52. Accommodation and Food Services small businesses employ 8.66 million people.

Small Business Payroll and Compensation

53. $3.47 trillion in total small business payroll.
54. Professional services small businesses paid $509.4 billion in payroll.

Conclusion

The 2025 data reveal that small businesses are not only expanding in number but also adapting to new financial and operational realities. Yet challenges, such as rising costs and volatile cash flow, remain.

Primary Sources

U.S. Small Business Administration

• SBA Office of Advocacy. (2025). 2025 Small Business Profiles for the States, Territories, and Nation. 
• SBA Office of Advocacy. (2025). United States 2025 State Profile. 

U.S. Bureau of Labor Statistics

• Bureau of Labor Statistics. (2025, May 7). Small businesses continue to outpace large businesses in job creation.
• Bureau of Labor Statistics. (2025). Business Employment Dynamics Data. 

U.S. Census Bureau

• U.S. Census Bureau. (2025, May 8). Small Business Week 2025: Recognizing Big Drivers of U.S. Economy. 
• U.S. Census Bureau. (2025). Business Dynamics Statistics (BDS). 
• U.S. Census Bureau. (2025). Statistics of U.S. Businesses (SUSB)
• U.S. Census Bureau. (2025). Nonemployer Statistics by Demographics
• U.S. Census Bureau. (2025). Annual Business Survey

Federal Reserve System

• Federal Reserve System. (2025). 2025 Report on Employer Firms: Findings from the 2024 Small Business Credit Survey. 
• Philadelphia Fed. (2025, July 8). Small Business Credit Survey: 2025 Third District Insights. 
• Cleveland Fed. (2025). Small Business Credit Survey. 

Other Federal Agencies

• Federal Financial Institutions Examination Council (FFIEC). (2025). Community Reinvestment Act (CRA) Aggregate Data
• Federal Deposit Insurance Corporation (FDIC). (2024). 2024 Small Business Lending Survey Report

Additional Data Source

• The Kaplan Group. (2025, August). Which States Lead the Nation in Launching New Businesses? Analysis of business formation and bankruptcy rates by state.