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February Economic Snapshot: Small Businesses in NYC

 |  NYCEDC

By Kimberly A. Grauer, Project Manager, Economic and Research Analysis 

Small businesses are a hugely important part of the economy.

The Small Business Administration recently cited that over 99.7 % of all employers are small firms across the United States. Small businesses are especially important in NYC, employing approximately 1.7 million individuals as of Q4 2014. Recently, the Center on Urban Future, a NYC think tank, found that just over 90% of all NYC businesses actually had fewer than 20 employees. According to their research, this is a higher percentage than all but one of the 363 metro areas across the United States. This month’s economic snapshot is zooming in on small businesses to review and analyze trends, post-recession growth and ownership demographics in NYC. The Small Business Administration recently cited that over 99.7 % of all employers are small firms across the United States. Small businesses are especially important in NYC, employing approximately 1.7 million individuals as of Q4 2014. Recently, the Center on Urban Future, a NYC think tank, found that just over 90% of all NYC businesses actually had fewer than 20 employees. According to their research, this is a higher percentage than all but one of the 363 metro areas across the United States. This month’s economic snapshot is zooming in on small businesses to review and analyze trends, post-recession growth and ownership demographics in NYC. 

Small Business Employment

Taking a closer look at businesses with less than 500 employees, there are strong trends within the various business sizes. Of the 1.7 million individuals working at small businesses, 40% were employed at firms with between 0-19 employees in 2014 (Figure I).

Figure 1

The largest share of businesses this size was situated in the Accommodation and Food Services industry (13.5%), with a near majority of these establishments located in Manhattan. The Retail Trade sector accounted for 13.3% of employment for businesses with 0-19 employees, with a nearly equal number of businesses located in Brooklyn and Manhattan. Figure II breaks down employment growth in businesses with 0-19 employees by industry.

Figure 2

Post-recession job growth has been strong for small businesses. Businesses with 20-49 employees experienced a growth of 15.3% between 2009 and 2014 and establishments with 0-19 employees grew by 13.8% during this time. Businesses with 250-499 experienced the weakest growth between 2009 and 2014 (5.9%) (See Figure III).

figure 3

Small Business Owners

In NYC, 211,048 individuals1 were self-employed at their own incorporated business in 2014. Nearly 97,000 of these were owned by individuals born outside the United States. While foreign-born individuals comprised 33.3% of the NYC population in 2014, they owned 45.8% of these incorporated businesses. This suggests that immigrants start businesses at higher rates than natives in NYC. The largest share of foreign-born small business owners came from China (8.6%), followed by Korea (7.6%), India (7.5%), Dominican Republic (5.2%), Jamaica (3.4%), Russia (3.2%), Italy (3.2%), Ecuador (2.9%), Israel (2.5%), and Greece (2.3%).

The percent of small businesses owned by women grew from 27.1% in 2005 to 30.7% in 2014 (See Figure IV). This rate was comparable between native and foreign born female businesses owners (31.6% female ownership versus 29.6%, respectively). The female share of ownership varies by country of origin, with rates ranging from 16.7% (Italy) to 44.8% (Dominican Republic) (See Figure V).

1 As defined by those who live or work in NYC.

figure iv


Works Cited

“Small Business Success” Center for an Urban Future
U.S. Census Bureau, American Community Survey 5-year Estimates, 2014
U.S. Census Bureau, Longitudinal Employment-Household Dynamics, Q4 2014.
Small Business Administration


For the full report on charitable giving in NYC, read the February 2016 Economic Snapshot

For all other economic reports, visit our economic data archive on the Economic and Research Analysis page.


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