The Kauffman Index 2015: Main Street Entrepreneurship State Trends

Abstract

The Kauffman Index: Main Street Entrepreneurship is a novel indicator of small business activity in the United States, integrating high-quality sources of timely information into one composite indicator. The Index captures business activity in all industries, and is based on both a nationally representative sample size of roughly 900,000 responses each year and on the universe of all employer businesses in the United States. The focus here is on established small businesses — employer firms older than five years and with fewer than fifty employees — and the business owners based on a location. As such, we examine both the business owners and the businesses they own.This report presents trends in Main Street entrepreneurship activity over the past two decades for all fifty states of the United States. Main Street entrepreneurship is an important aspect of the U.S. economy and society. Established small businesses make up 63 percent of all employer firms in the United States and are a source of local economic activity.Entrepreneurship is a multi-dimensional phenomenon, and the Kauffman Index of Entrepreneurship series — the umbrella initiative for all Kauffman Index reports — studies and analyzes entrepreneurship from various perspectives. Another report, the Kauffman Index: Startup Activity, seeks to view the beginnings of entrepreneurship, focusing on new business creation, market opportunity, and startup density. This report, the Kauffman Index: Main Street Entrepreneurship, takes a different angle and attempts to understand prevalence of local small business.This report presents trends in Main Street entrepreneurship activity for the fifty states of the United States, and analyzes trends for states looking at them in two different cohorts: one for the twenty-five largest states by population and another for the twenty-five smallest states by population.