Small businesses are the backbone of the U.S. economy and have been for hundreds of years. Most businesses that are started begin with a dream, someone’s lifelong ambition to do something they are passionate about, which then turns into a small business.
Pennsylvania is no stranger to small businesses; in fact, it ranks 7th in the U.S. for the most number of small businesses in the state.
The Keystone State is considered one of America’s top economic powerhouses. Over the past several years, it has been consistently voted as one of the top states for business due to the government’s pro-business approach, proximity to huge consumer markets, a large civilian workforce, low and competitive tax incentives, and high quality of life.
Number of Small Businesses in Pennsylvania
So, how many small businesses are there in Pennsylvania? There are 1,074,787 (1.1 million) small businesses in Pennsylvania, according to the latest figures (2020) from the SBA.
It is not just Americans and Pennsylvanians starting small businesses in Pennsylvania; the state is a big attraction for international entrepreneurs and foreign-born people. There are 55,763 immigrant entrepreneurs in Pennsylvania that account for 10% of all self-employed Pennsylvania residents.
The following bar graph shows the number of small businesses in Pennsylvania in 2016, 2017, 2018, 2019, and 2020.
Of the 1,074,787 small businesses in Pennsylvania in 2020, there is a wide array of different enterprises from small, one-person sole proprietorships or LLCs to much larger businesses with several hundred employees. If you want to join the 1.1 million-plus small businesses in Pennsylvania, it is fairly easy to register a business in Pennsylvania.
To be a small business in Pennsylvania, you have to qualify as one. So, to operate as a small business in Pennsylvania, you must have a company with less than 500 employees.
Let’s take a deeper dive into the number of small businesses in Pennsylvania by looking at the top industries, small business owners, employees, and more!
Latest Small Businesses Statistics in Pennsylvania
- Small businesses equate to over 99.6% of all businesses in Pennsylvania.
- There are 2,512,633 small business employees in Pennsylvania, which is 46.2% of the states’ employees.
- In 2019, Small Businesses in Pennsylvania added 57,377 new jobs!
- Small businesses employing 20-99 employees created the most job gains!
- There are 89,074 self-employed minorities in Pennsylvania demonstrating the diversity in the state.
- International trade in Pennsylvania is strong and there are 13,971 small business exporters.
- There are more professional, scientific & technical services small businesses in Pennsylvania than any other type – 146,960.
- Construction firms make up the 2nd largest number of small businesses in Pennsylvania – 118,575.
How Many Small Businesses in Pennsylvania?
Over 1.1 million is a lot of small businesses to be registered in any one state. Compared to the rest of the U.S., the total number of small businesses in Pennsylvania is 3.39% of all U.S. businesses. There are 31.7 million small businesses in the U.S.
The number of small businesses in Pennsylvania has been growing over the past several years. In 2017 there were 1,025,045 small businesses, which increased to 1,037,737 in 2018, representing a 1.23% increase. In 2019 there were 1,058,033 small businesses which were 20,296 more than the state had in 2018, representing a 1.95% increase.
From 2019 to 2020, the number of small businesses in Pennsylvania rose again, to 1,074,787. This is the second-largest increase in percentage terms over the past five years (1.58%) and demonstrates Pennsylvania’s strong economy.
Pennsylvania has an awful lot to offer employers and employees and companies and entrepreneurs from all over the world continue to flock to the state due to its huge civilian workforce of over 12.7 million, access to large consumer markets, world-class infrastructure, a healthy import/export market, and strong population and job growth.
If you would like to download the latest 2020 Small Business Profile on Pennsylvania from the U.S. Small Business Administration, Office of Advocacy, the Profile can be downloaded here.