Useful Stats: State Business Churning Figures (1998-2001)

The U.S economy experienced a turbulent year in 2001. However, small businesses demonstrated resilience and strength according to the Small Business Economic Indicators for 2001, a report released by the SBA Office of Advocacy. The February 2003 report states that although economic activity was sluggish in the months leading up to September 2001, economic output grew for the year as a whole.

In comparison to 2000, small businesses seemed to hold steady in 2001. The levels of employer firms and the self-employed were relatively consistent with previous year totals. While employer firm births showed a slight downward movement during the year and firm closures increased slightly, the most alarming number was the rise in business bankruptcies.

SSTI has prepared a table presenting "business churning" statistics and rankings for all 50 states and the District of Columbia over a four-year period from 1998-2001 using data from the SBA indicator report. Business churning is a measure of new firm births and existing firm deaths as a share of total firms. This churning increases as the number of new start-ups and existing business failures per year increases. Business churning is seen as a major driver of innovation and growth.

The table is available at: http://www.ssti.org/Digest/Tables/022103t.htm

Other state level data available in the report include the number of self-employed, business bankruptcies, and financial information. Industrial level data is provided for nonfarm private employment and the fastest and largest growing industries in 2000-2001. Other macro-level indicators for the U.S. economy are presented as well. Small Business Economic Indicators for 2001 can be downloaded at: http://www.sba.gov/advo/stats/sbei01.pdf