Small businesses are defined by annual revenue or number of employees, though measures fluctuate dramatically between industries and countries.
In the U.S., for example, they are facing diverse challenges. In 2023, over half of independent companies perceived a recession despite financial stability. What lies ahead, then?
Stay tuned as we outline 10 crucial small business statistics to consider in 2025 if you want to follow the path of entrepreneurship.
What exactly is a “small business?”
In business terms, a small business isn’t just about the money it makes. The U.S. Small Business Administration (SBA) uses a couple of factors to decide if a company is ‘small’: average yearly earnings and the number of employees.
There, small businesses can earn anywhere from $1 million to over $40 million and have a staff of 100 to 1.500 people.
For a company to be called a small business, it must meet the size standard for its industry based on things like total earnings or the average number of employees over the past year.
Contextual Statistics on Small Businesses
In 2023, small enterprises stood out as the unsung heroes. In countries like the U.S. or the U.K., entrepreneurs drive over 90% of their economies.
Here are some more contextual stats to understand the present and future of small businesses.
1. There are 33.2 million small businesses across the U.S.
Data from the SBA demonstrates how small businesses are substantial economic drivers in America.
In the U.S., there were around 33.2 million small businesses in 2023, which means 99.9% of the companies in that country.
This kind of enterprise employs roughly 6 million workers across the nation. Still, attention frequently goes to publicly traded giants versus the millions of home-grown, community-focused firms dotting the country.
2. Over 5.5 million enterprises in the U.K. are small businesses
Just as in the United States, the heartbeat of the U.K. economy lies in these countless small and medium enterprises.
As of October 2023, the entrepreneurial landscape in the U.K. boasted 5.6 million businesses.
Out of this staggering figure, precisely 5,547,000 fell into the small or medium business category, constituting 99.05% of all companies in the U.K.
3. 28% of individuals embark on the entrepreneurial journey to gain independence
A desire for independence fuels entrepreneurial dreams.
A study by Guidant Financial reveals that 28% of individuals in the U.S. embark on the entrepreneurial journey to gain control of their time.
Beyond autonomy, motivations include a quest for happiness in large corporations (23%), passion-driven pursuits (13%), and a response to job loss, with 10% starting businesses after facing unemployment.
4. Millennials own 7% of U.S. small businesses
Despite assumptions of high entrepreneurial drive, millennials own only 7% of American small businesses today. In comparison, Gen Z owns 1%. Most fall under Baby Boomer control at nearly 40%, while Gen X owns 47%.
While a gap remains between generations, the millennial share grew 6% over previous estimates.
With their numbers still expanding, millennials can continue assuming ownership of small firms as Baby Boomers retire in the coming years.
Challenges Facing Small Businesses in 2025
Small businesses are dealing with challenges.
About half of small business owners need help finding job openings due to ongoing inflation, and the average salary for small business owners in the U.S. is just 3% higher than the average.
With hiring difficulties and squeezed profits squeezing budgets, small enterprises have repeatedly demonstrated resilience by innovating and leveraging cost-effective tools to withstand recessions.
Here are other small business statistics to consider in 2025.
5. 40% of U.S. small businesses struggle to find workers due to inflation
A recent survey of over 600 small business owners in the U.S. revealed that 40% need help filling job openings. This statistic comes in late 2025, as inflation continues hampering operations.
Optimism for business conditions in coming months also dropped to levels typically seen during recessions.
The monthly National Federation of Independent Business poll highlighted how hiring challenges, inflated costs, and squeezed profits persist for America’s small enterprises.
6. The average U.S. small business owner’s salary is 3% above the average annual wage
A small business owner’s average salary is just 3% above the annual mean wage in the U.S., which is $58,260.
Despite the perception that business owners and entrepreneurs are among the wealthiest, the reality is that the average small business owner’s salary is modest, reaching $60,151. However, it’s crucial to note that these figures vary significantly.
According to Forbes, small business owners earn an average of $29,000 on the lower end, while those on the higher end can command an average salary of $128,000, according to pay rate data from Payscale.
7. Small businesses in the U.S. face 9-12% interest rates for a loan
As inflation’s impact lingers, small businesses in the U.S. are grappling with significant hikes in core expenses. Despite a Federal Reserve effort to curb inflation, the national prime interest rate is 8.5%.
According to The Guardian, securing new loans comes at a hefty price for smaller companies not categorized as “prime” customers, with interest rates ranging from 9% to 12%.
With limited room to pass these costs to customers, many small business owners are streamlining operations to endure tight profit margins in the face of economic challenges.
Small Business Marketing Statistics
8. 94% of small businesses to increase marketing budgets in 2025
A recent survey found that 94% of small businesses intend to allocate more funds towards marketing efforts in 2025. Social media advertising is expected to receive the bulk of expenditures.
Statistics also show that 70% of small companies utilize social media advertising today. Over one-quarter of that group dedicates 10-30% of total marketing budgets to platforms like Facebook and Instagram.
The data highlights how cost-effective and targeted social reach has become for small businesses.
9. 83% of small businesses prioritize Facebook marketing
Regarding social media marketing, small businesses prefer Facebook over other platforms. 83% of firms surveyed said they focus on this platform, followed by 48% of small companies that allocate social media budgets to Instagram.
On the other hand, recent data also shows YouTube as consumers’ most trusted social site, followed by Facebook and Instagram. At the same time, LinkedIn and TikTok receive less than half the attention of Facebook and Instagram.
10. 75% of small businesses in retail heavily depend on the holiday season
Year-end celebrations hold immense significance for small businesses, particularly those in the U.S. retail and e-commerce sectors.
Recent surveys show its crucial role in meeting annual revenue targets for 75% of small businesses. However, only 18% feel highly effective in retaining customers post-holidays.
