Each year the SBA Office of Advocacy compiles the top 20 most frequently asked questions (FAQ) and their answers ranging from what the SBA considers to be a small business to what the small business survival rate is during the first year.
The following are the questions and answers everyone wants to know about small business:
- What is a small business? The Office of Advocacy defines a small business as an independent business having fewer than 500 employees. For the industry-level definitions of small business used in government programs and contracting to see the SBA Size Standards Table.
- How many small businesses are there in the U.S.? In 2015, there were 30.2 million small businesses.
- What is the role of small businesses in the economy? Small businesses comprise 99.9 percent of all firms with 47.5 percent of private sector employees.
- What percent of net new jobs do small businesses create? From 2000 to 2017, small businesses created 8.4 million net new jobs while large businesses created 4.4 million, accounting for 65.9 percent of net new job creation in the period.
- How can small businesses generate two-thirds of net new jobs, but their share of employment is less than 50 percent? As firms grow, they change employment size classes. So as small firms grow, their growth counts toward small firm job gains; but if they pass the 500-employee mark, their employment gains are classified as large firm employment.