Could Main Street be having a renaissance? Data collected by the Kauffman Foundation indicates that entrepreneurship is rising and that small business activity increased in all but one US state and in 38 of the top 40 largest metropolitan areas. Kauffman shared its findings December 10 in its report, 2015 Kauffman Index: Main Street Entrepreneurship.
“Following a post-recession downward and stagnant trend in small business activity … This obviously is good news given that these small businesses make up 63 percent of all employer firms nationally,” said E.J. Reedy, director in Research and Policy at the Kauffman Foundation.
The Index presents trends over the past two decades, focusing on small businesses older than five years with less than 50 employees. It measures the percentage of adults owning a business in a given month, and the ratio of established small employer businesses compared to population.
New York is the top metropolitan area for small business activity, according to the Index. Boston and Providence, RI, share second place, San Francisco is third, and Portland, Ore., is fourth in terms of small business activity. Among the top 40 U.S. metro areas, only Nashville and Charlotte, NC, saw less small business activity in 2015 than in 2014.
Rates of business ownership vary widely across metropolitan areas. The Index counted approximately 3,810 business owners for every 100,000 adults in the Cincinnati metropolitan area to nearly 8,690 businesses owners for every 100,000 adults in Miami. And the density of businesses also varies, ranging from a low of 560 established small businesses per 100,000 people in Riverside, Calif., to a high of 1,267 established small businesses per 100,000 people in New York.
At the state level, the Index found Tennessee to be the only one in 50 that did not show an increase in established small business activity between 2014 and 2015.