Prosperity Now Scorecard

Businesses & Jobs
Small Business Ownership Rate
Definition

Total number of firms with 5-99 employees as a percentage of people in the labor force, 2013.

Description

Small businesses drive the economy—they employ more than half the private sector workforce and serve as an engine for job creation. The higher the business ownership rate in a state, the higher the percentage of residents who have the opportunity to build wealth through business capital accumulation. Business ownership is second only to homeownership as a source of wealth for Americans. This measure shows the percentage of individuals in the state's labor force that operate their own small businesses.

There are many ways to define small businesses. The federal Small Business Administration defines them as having fewer than 500 employees. In the Scorecard, we define small businesses as having fewer than 100 employees but larger than a microenterprise (businesses run by self-employed individuals or with fewer than five employees). 

1.4% of the labor force in the United States owns a small business

Small Business Ownership Rate, 2013

StatePercent of Labor Force Owning
Small Businesses (%)
Rank
United States 1.38%
Alabama 1.36% 37
Alaska 1.59% 8
Arizona 1.15% 51
Arkansas 1.46% 24
California 1.35% 39
Colorado 1.43% 28
Connecticut 1.47% 22
Delaware 1.54% 14
District of Columbia 1.89% 3
Florida 1.25% 46
Georgia 1.21% 49
Hawaii 1.49% 17
Idaho 1.58% 9
Illinois 1.34% 40
Indiana 1.35% 38
Iowa 1.41% 32
Kansas 1.47% 23
Kentucky 1.29% 45
Louisiana 1.58% 10
Maine 1.56% 11
Maryland 1.30% 44
Massachusetts 1.49% 18
Michigan 1.41% 30
Minnesota 1.43% 26
Mississippi 1.37% 35
Missouri 1.39% 34
Montana 2.02% 1
Nebraska 1.52% 15
Nevada 1.19% 50
New Hampshire 1.55% 12
New Jersey 1.47% 21
New Mexico 1.41% 31
New York 1.51% 16
North Carolina 1.31% 43
North Dakota 1.86% 4
Ohio 1.36% 36
Oklahoma 1.48% 20
Oregon 1.68% 7
Pennsylvania 1.42% 29
Rhode Island 1.55% 13
South Carolina 1.33% 41
South Dakota 1.82% 6
Tennessee 1.25% 47
Texas 1.23% 48
Utah 1.39% 33
Vermont 1.86% 5
Virginia 1.31% 42
Washington 1.48% 19
West Virginia 1.46% 25
Wisconsin 1.43% 27
Wyoming 2.00% 2

Change in Small Business Ownership Rate

Percent of Labor Force Owning Small Businesses (%)
State20062007200820092010201120122013
United States 1.48% 1.50% 1.50% 1.41% 1.37% 1.36% 1.36% 1.38%
Alabama 1.51% 1.50% 1.50% 1.45% 1.43% 1.36% 1.37% 1.36%
Alaska 1.66% 1.70% 1.60% 1.58% 1.58% 1.57% 1.59% 1.59%
Arizona 1.33% 1.40% 1.30% 1.19% 1.12% 1.13% 1.15% 1.15%
Arkansas 1.51% 1.50% 1.50% 1.46% 1.44% 1.41% 1.43% 1.46%
California 1.50% 1.50% 1.50% 1.42% 1.37% 1.33% 1.34% 1.35%
Colorado 1.56% 1.60% 1.50% 1.49% 1.47% 1.42% 1.42% 1.43%
Connecticut 1.66% 1.60% 1.60% 1.53% 1.48% 1.45% 1.47% 1.47%
Delaware 1.63% 1.70% 1.60% 1.59% 1.60% 1.51% 1.54% 1.54%
District of Columbia 2.14% 2.10% 2.10% 2.09% 2.07% 1.97% 1.94% 1.89%
Florida 1.43% 1.40% 1.40% 1.30% 1.24% 1.23% 1.25% 1.25%
Georgia 1.34% 1.30% 1.30% 1.29% 1.26% 1.21% 1.21% 1.21%
Hawaii 1.68% 1.70% 1.60% 1.62% 1.58% 1.48% 1.50% 1.49%
Idaho 1.85% 1.90% 1.90% 1.76% 1.66% 1.59% 1.57% 1.58%
Illinois 1.49% 1.50% 1.40% 1.42% 1.37% 1.35% 1.36% 1.34%
Indiana 1.49% 1.50% 1.50% 1.43% 1.41% 1.38% 1.37% 1.35%
Iowa 1.56% 1.50% 1.50% 1.49% 1.47% 1.45% 1.44% 1.41%
Kansas 1.60% 1.60% 1.60% 1.53% 1.50% 1.47% 1.48% 1.47%
Kentucky 1.48% 1.50% 1.40% 1.36% 1.32% 1.30% 1.30% 1.29%
Louisiana 1.68% 1.70% 1.70% 1.66% 1.62% 1.61% 1.61% 1.58%
Maine 1.77% 1.80% 1.70% 1.65% 1.62% 1.58% 1.57% 1.56%
Maryland 1.46% 1.50% 1.40% 1.40% 1.38% 1.31% 1.30% 1.30%
Massachusetts 1.63% 1.60% 1.60% 1.53% 1.48% 1.47% 1.49% 1.49%
Michigan 1.50% 1.50% 1.50% 1.44% 1.41% 1.41% 1.43% 1.41%
Minnesota 1.59% 1.60% 1.50% 1.48% 1.45% 1.42% 1.43% 1.43%
Mississippi 1.45% 1.50% 1.50% 1.42% 1.37% 1.32% 1.35% 1.37%
Missouri 1.54% 1.50% 1.50% 1.45% 1.42% 1.39% 1.40% 1.39%
Montana 2.21% 2.20% 2.20% 2.17% 2.10% 2.05% 2.02% 2.02%
Nebraska 1.65% 1.60% 1.60% 1.60% 1.59% 1.54% 1.52% 1.52%
Nevada 1.38% 1.40% 1.40% 1.28% 1.22% 1.15% 1.18% 1.19%
New Hampshire 1.74% 1.70% 1.70% 1.60% 1.57% 1.56% 1.55% 1.55%
New Jersey 1.63% 1.60% 1.60% 1.52% 1.48% 1.44% 1.46% 1.47%
New Mexico 1.55% 1.60% 1.50% 1.48% 1.42% 1.41% 1.42% 1.41%
New York 1.54% 1.50% 1.50% 1.50% 1.48% 1.49% 1.50% 1.51%
North Carolina 1.51% 1.50% 1.50% 1.43% 1.38% 1.32% 1.30% 1.31%
North Dakota 1.88% 1.90% 1.90% 1.88% 1.91% 1.85% 1.87% 1.86%
Ohio 1.48% 1.50% 1.40% 1.38% 1.35% 1.34% 1.36% 1.36%
Oklahoma 1.57% 1.60% 1.60% 1.55% 1.53% 1.48% 1.48% 1.48%
Oregon 1.78% 1.80% 1.80% 1.67% 1.61% 1.59% 1.63% 1.68%
Pennsylvania 1.54% 1.50% 1.50% 1.47% 1.46% 1.43% 1.42% 1.42%
Rhode Island 1.71% 1.70% 1.70% 1.62% 1.53% 1.52% 1.54% 1.55%
South Carolina 1.55% 1.60% 1.50% 1.44% 1.38% 1.34% 1.34% 1.33%
South Dakota 1.89% 1.90% 1.80% 1.84% 1.85% 1.83% 1.83% 1.82%
Tennessee 1.39% 1.40% 1.40% 1.33% 1.29% 1.23% 1.25% 1.25%
Texas 1.34% 1.40% 1.30% 1.30% 1.27% 1.23% 1.24% 1.23%
Utah 1.50% 1.50% 1.50% 1.44% 1.39% 1.41% 1.39% 1.39%
Vermont 2.01% 2.00% 2.00% 1.88% 1.83% 1.81% 1.83% 1.86%
Virginia 1.49% 1.50% 1.40% 1.38% 1.34% 1.31% 1.32% 1.31%
Washington 1.62% 1.60% 1.60% 1.51% 1.47% 1.46% 1.46% 1.48%
West Virginia 1.61% 1.60% 1.60% 1.57% 1.56% 1.48% 1.47% 1.46%
Wisconsin 1.60% 1.60% 1.60% 1.50% 1.48% 1.46% 1.45% 1.43%
Wyoming 2.23% 2.20% 2.20% 2.17% 2.13% 2.03% 2.02% 2.00%

Definition

Total number of firms with 5-99 employees as a percentage of people in the labor force, 2013.

Source

Business Dynamics Statistics. Washington, DC: U.S. Department of Commerce, Census Bureau, 2015.

Labor Force: Local Area Unemployment Statistics. Washington, DC: U.S. Department of Labor, Bureau of Labor Statistics, 2013.