Small businesses, which are estimated to employ nearly half of all American workers, have been dealing with a lot of setbacks from the COVID-19 pandemic. A recent Federal Reserve Bank study noted that the pandemic caused an additional 200,000 businesses to close their doors last year, with small businesses comprising the bulk of the difference.
A new report from Self Financial looked at the U.S. states that have seen the largest increase in new business applications, with a nearly 25% increase in new business applications in the U.S. between 2019 and 2020, and that increase held relatively steady through 2021, according to the report.
The analysis found that in 2019, New Jersey received 112,540 new business applications. In 2020, that number increased to 134,450 applications — an increase of 19.5%. Here is a summary of the data for New Jersey:
- Percentage change in business applications (2019-2020): +19.5%
- Total change in business applications (2019-2020): +21,910
- Total business applications in 2020: 134,450
- Total business applications in 2019: 112,540
Percentage change in business applications for the entire U.S.:
- Percentage change in business applications (2019-2020): +24.2%
- Total change in business applications (2019-2020): +848,210
- Total business applications in 2020: 4,356,870
- Total business applications in 2019: 3,508,660
Nationally, at the industry level, the increase in new business applications is being led by the retail trade sector of the economy. When comparing the number of applications from 2019 to 2020, retail trade applications increased by 59%, followed by the transportation sector, which increased nearly 35%. Further, the largest percentage increases in applications were more likely to occur in those sectors already generating the highest number of applications overall. Together, this indicates the start of a robust trend for total small business creation in the economy.