How Many New Businesses Start Each Year?
New business statistics indicate that more and more people in the United States have started their own businesses over the past decade.
This is no surprise, given the US’s relatively high rating of 91.6 out of 100 by the World Bank for ease of starting a business.
So then, how many new businesses start each year?
According to the US Business Formation Statistics (BFS), the number of business applications has been on a steady rise since the start of the previous decade.
In 2010, the number of new business applications was 2.50 million. Fast forward a decade to 2020 and this figure rose 75 percent to 4.38 million. It was also a 24.7 percent increase from 2019 and the biggest increase of the past decade by a mile.
New Business Statistics During the COVID-19 Pandemic
The start of 2020 saw fewer people start new businesses in the US. New business statistics from the first quarter of 2020 show that there were a total of 841,180 applications. This represents a 3.96 percent year-over-year fall and can be attributed to the economic uncertainty triggered by the coronavirus pandemic.
However, sentiment quickly rebounded: Q2 2020 saw 906,876 new business applications—a 7.81 percent rise from Q1 and a 4.4 percent increase year-over-year.
Q3 2020 saw quarterly new business applications hit an all-time high. More than 1.47 million new applications were filed—an impressive 62.75 percent quarterly increase and a 70.12 percent year-over-year jump.
Industry experts say the steep surge in Q3 may be due to delayed processing of a backlog of applications and the ecommerce boom, which spurred many to start online businesses.
New business statistics show that in 2021, nearly 5.4 million applications were filed, the most in any given calendar year so far.
Analysts credit a part of the recent increase to a “need” from people after having lost their jobs during the pandemic; starting their own business is a way to potentially acquire lost income. Some are also doing so to meet rising and changing consumer demands.
New business statistics from 2022 show that the year is starting on a positive note. Over 430,000 new business applications were filed in January, a 2.6 percent increase from the previous month.