By Angelo Young
February 22, 2022
Source: 247 Wall St
Photo Source: Unsplash, Jay Wennington With more than 32 million small businesses in 2021 — about 8% of them founded in any given year — the United States has a vibrant business startup culture. Even though nearly half of these new-business entrants will not last beyond five years, a slightly higher number of new enterprises replace the ones that close every year.
Startups tend to be small businesses, which create 66% of new jobs and comprise 44% of U.S. gross domestic product, according to the Small Business Administration. As much as large and established publicly traded companies play an important role in the U.S. economy, small businesses make up the backbone of the economy. (There are also government-run companies – these are 14 big businesses run by the U.S. government.)
These businesses include small hotels and family-run restaurants, trucking firms and real estate agencies, manufacturers with small numbers of employees, and independent contractors who incorporate and work for themselves. (Eventually some startups grow enough to go public. These are the biggest IPO runups of the last 50 years.)
A good measure of an area’s new-business activity is the number of new-business applications. It is not a perfect measure, as these applications do not always lead to new businesses. Nevertheless, it offers an apples-to-apples comparison of entrepreneurial efforts between cities, counties, or states.
To identify the 50 counties with the most business applications in 2020, 24/7 Wall St. reviewed Business Formation Statistics from the U.S Census Bureau. All county and county equivalents, including independent cities, were considered. Counties and county equivalents were ranked on new business applications submitted in 2020 per 1,000 people. State and local population figures are five year estimates from the Census’s 2019 American Community Survey.
The median number of new-business applications among the top 50 U.S. counties based on startup activity in 2020 was 29.4 applications per 1,000 residents. Out of these 50 counties, 13 are in Georgia, with a median of 33.8 applications per 1,000 residents. Mississippi comes in second with eight counties on the list. Notably absent are the two most populous U.S. states, California and Texas.
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