are "mom & pops" thriving, dying or hanging on?

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Are Small Businesses in the U.S. Thriving, Dying or Hanging On?

Source: http://www.census.gov/econ/susb/index.html

http://www.census.gov/econ/susb/index.html

http://www.census.gov/econ/susb/index.html


The Big Question:

Are Small Businesses in the U.S.

a. Thriving,b. Dying, orc. Hanging On?


First, let’s look at how they stack up in terms of:

Number of Employers (Firms)

Number of Employees

Estimated Receipts

Avg. Wage (Payroll)

Efficiency (Receipts per Employee)

Receipt Growth Rate


Then, we’ll see whether small businesses in some industries

are faring better than in others


But First:Defining Different Firm Size

Groups• Firms:

– “Non-Employers” – 0 Employees – “Micro” – < 10 Employees– “Small” – 10-99 Employees– “Medium” – 100-499 Employees– “Large” – 500+ Employees


Question #1

“How many more small businesses are there compared to large businesses in the U.S.?”


A: For every 1 firm with more than 100 employees, there are 55 with less than 100 employees


Question #2

“Overall, do more people in the U.S. work in small businesses or large ones?”


A: For every 5 employees working at a company with less than 100 employees, there are 9 working at a company

with more than 100 employees


Question #3

“On average, how much more money does a large business receive compared to a small one?”


A: For every $1,000 received by a company with less than 100 employees, a company with more than 100

employees receives $157,000 per year


Question #4

“Recently, which has been growing faster: small businesses or large ones?”


A: Between 1992 and 2007, the largest firms (>500 employees) nearly doubled their receipts, while small firms

(<100 employees) lagged inflation


The Big Get Bigger (1992-2007)Growth of U.S. Private Firms, by Size (Number of Employees) 1992-2007


Question #5

“Who pays employees better, large businesses or small ones?”


A: In 2007, an employee of a large firm earned 33% more per year than an employee of a micro firm, on average


Question #6

“Who is more efficient with their workforce: large businesses or small ones?”


A: In 2007, large firms pulled in 53% more per employee than micro firms, on average


So, to summarize so far:

• In 2007:– HALF of U.S. employees work for– less than HALF a percent (0.30%) of

all firms (LARGE Ones), that bring in:– more than 95% of the Receipts– which have grown at twice the rate of

small businesses since 1992


But…

Are there some industries in which small businesses are faring better than in others?


Question #7

“Have small businesses been growing faster in some industries as compared to others?”


A: Between 2002 and 2007, Wholesale Trade, Construction, Health care, and Professional Services grew

the most

Growth of Small Businesses (<100 Employees), by Industry (2002-2007)


Question #8

“Are there some industries where small businesses make much more than in others?”


A: In 2007, Utilities and Wholesale trade Small Businesses brought in the most per firm, on average


To Answer the Big Question

• By and large, Small Businesses in the U.S. are barely hanging on, while

• There are some industries in which small businesses are thriving


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