📊 Small Business Profiles for the States, Territories, and Nation 2025: Key Economic Insights
The “Small Business Profiles for the States, Territories, and Nation 2025” report from the U.S. Small Business Administration’s Office of Advocacy provides a comprehensive snapshot of the small business landscape across the United States, including all 50 states, the District of Columbia, and U.S. territories. This annual report is a vital resource for understanding the economic role, trends, and challenges facing small businesses nationwide.
Overview of the U.S. Small Business Landscape
Small businesses remain the backbone of the U.S. economy. According to the 2025 report:
- Prevalence and Employment
- 🏢 There are 36.2 million small businesses in the U.S., making up 99.9% of all businesses.
- 👥 These businesses employ 62.3 million people, accounting for 45.9% of the nation’s private workforce.
- 📈 Small businesses are defined as firms with fewer than 500 employees, a standard used across all states and territories for consistency.
- Business Dynamics
- 🔄 Between March 2023 and March 2024, 1,281,290 establishments opened and 1,125,979 closed, resulting in a net gain of 155,311 establishments.
- 🚀 Small businesses were responsible for 1.1 million of these openings and 982,940 closings.
- 💼 Opening and expanding establishments added 14.4 million jobs, while closing and contracting ones lost 13.0 million, for a net gain of 1.4 million jobs.
- 🏆 Small businesses contributed a net increase of 1.2 million jobs—an impressive 88.9% of total net job creation.
- State and Regional Variation
- 🌎 The share of employees working at small businesses varies by state, reflecting differences in economic structure, industry mix, and population.
- 🗺️ For example, states like New Mexico and Hawaii see over 49% of employees in small businesses, while others like Arizona and Ohio are closer to the national average.
- Industry Distribution
- 🏗️ Small businesses are active across all sectors, with especially high representation in construction, professional services, retail, and health care.
- 🛠️ Many small businesses operate in multiple industries, and the sum of businesses by industry can exceed the total number of unique firms.
- Small Business Lending
- 💵 In 2023, large banks issued $84.2 billion in loans to businesses with revenues of $1 million or less.
- 🏦 Total new lending to businesses through loans of $1 million or less was significantly higher, supporting both startups and established small firms.
- 💳 Loans of $100,000 or less remain a critical source of capital for the smallest businesses and nonemployer firms.
- Data and Methodology
- 📊 The report draws on data from the Census Bureau, Bureau of Labor Statistics, and the Federal Financial Institutions Examination Council.
- 🧮 All statistics are based on the most recent data available, with clear definitions and transparent methodology to ensure comparability across states and territories.
Key Economic Takeaways for Small Business Stakeholders 💡
- ✅ Small businesses are the primary engine of job creation in the U.S., responsible for nearly 9 out of 10 net new jobs.
- ✅ The resilience of small businesses is evident in the net positive establishment and employment growth, despite ongoing closures and contractions.
- ✅ Access to capital remains a central issue, with lending trends indicating both opportunities and challenges for small business financing.
- ✅ State-level differences highlight the importance of local economic conditions, regulatory environments, and industry concentrations.
💡 Summary
The 2025 Small Business Profiles report confirms that small businesses are vital to the U.S. economy, driving job creation and economic growth across all regions and industries.
References:
Small Business Profiles for the States, Territories, and Nation 2025, U.S. Small Business Administration