The U.S. Census has new statistics out — and they show that the numbers of single-person businesses are booming. There are now over 20 million such businesses, based on the most recently available data as of 2005.
To be exact, the United States has 20,392,068 single-person businesses. In the space of three years, 2.7 million more people became the owner of a “business of one.” Here’s the chart (you knew there’d be a chart, right?):
For the past three years the number of single-person businesses has grown each year between 4% and 5%. That means the single-person businesses grow faster than the rate of growth of the U.S. population as a whole (which grows at about 1% a year according to the U.S. Census).
These single-person businesses account for 78% of ALL U.S. businesses. You know those millions of small businesses that everyone is always talking about? Well, the majority of them fall into this category of single-person business.
These single-person businesses bring in over $951 billion (US) in annual receipts or sales to the U.S. economy. That averages to roughly $46,600 in annual sales per business. Obviously, since it’s an average, some businesses will be larger and some smaller. Still, you can see that many are pretty small businesses. Whatever their individual size, collectively these business owners are a force because of the sheer numbers of them.
Statistics like this can seem conflicting and confusing, in part because the terminology is all over the map.
For instance, these single-person businesses are regularly referred to by other labels such as:
- nonemployer businesses (the U.S. government name)
- personal businesses (the trendy term)
- no-employee businesses (what analyst firms sometimes call them)
- self-employed individuals
- microbusinesses (generally, businesses with fewer than 5 employees)
- SOHOs (small office, home office)
- home-based businesses
- freelancers (added per Rene’s comment below)
In some cases these terms refer to the universe of single-person businesses. In other cases they refer to just a certain subset of single-person businesses, or they include some businesses with employees. If you see what appear to be conflicting statistics, make sure you know exactly which businesses they cover.
Note: please feel free to copy the above chart for your blogs, reports and presentations, as long as you retain the copyright notice — thanks, Anita!