According to the National Report on Early Stage Entrepreneurship in the United States: 2020, the rate of new entrepreneurs grew in 2020 (.38%) compared to 2019 (.31%).
Rapid new business growth was happening before the pandemic, but Covid ripped a giant band-aid off.
Covid started what is now called the “GREAT RESIGNATION.”
Many new entrepreneurs started businesses out of necessity. Others realized the benefits of working from home and for themselves. When you’re an entrepreneur, you control your destiny, schedule, life, and success.
Solopreneurs are dominating new business startups
There are millions of small businesses across the United States. According to Forbes, 73% of small businesses are solopreneurs, with 41.8 million people identifying as a one-person company. And those solopreneurs contributed $1.3 trillion to the economy.
Some experts predict over 50% of the total U.S. workforce will be solopreneurs by 2027.
Men continue to start more businesses than women
Overall, men are substantially more likely to start businesses than women.
The gap between men and women in new entrepreneurs has persisted for 2+ decades. The gap continued in 2020, but the rate of new entrepreneurship increased for both groups in 2020.
Women: In 2020, 300 out of 100,000 women became new entrepreneurs in a given month.
Men: In 2020, 480 out of 100,000 women became new entrepreneurs in a given month.
45-54 year olds lead new business startups
Since 2016, 45-54 years olds have led the pack jumping from corporate America to starting a business. But people 35-44 and 55-64 aren’t far behind.
Based on other studies, most people start a business to control their own destiny, increase satisfaction, and gain financial independence.
The media portrays startup CEOs as younger, but 20-34-year-olds have the lowest rate of entrepreneurship.
Many 20-34-year-olds are experimenting with jobs, learning more about their passions, understanding their boundaries, starting families, and potentially looking for traditional financial stability through a corporate job.
But the trends seem to show, as you gain experience (35+ yrs old), establishing a business becomes a viable option for some.
Latinos are most likely to start a business
The rate of entrepreneurship increased for all races and ethnic groups.
According to the U.S. Census Data, Latinos are most likely to start a business.
Latinos are starting businesses faster than the national average across multiple industries (construction, finance, insurance, transportation, and real estate.)
And Latino entrepreneurs tend to be younger than 45, compared to just 22% of non-Latino entrepreneurs.
Entrepreneurship Beyond 2021
Today, more than ever, there are thousands of resources to help new business owners. In addition, there are communities and networks of fellow entrepreneurs ready and willing to share advice with you.
As the Great Resignation spreads across the U.S., there’s a high likelihood the rate of entrepreneurship will continue to increase.
If you’re reading the article, you have all the ingredients to become a successful business owner. Sign up for our newsletter and follow us on social media. We’ll continue to be your resource to help you along your entrepreneurial journey.