A robust recovery from the COVID-19 pandemic recession has been indicated by the substantial increase in business creation in the U.S. economy since 2021. Between 2021 and 2023, entrepreneurs submitted 5.2 million "likely employer" business applications, a 34% increase from the pre-pandemic levels of 2017 to 2019. The most significant increase in business applications was observed in Wyoming, with a 93% increase. This growth has been observed throughout the country, with 47 states experiencing an increase in startup activity in 2022 and 2023, while 85% of U.S. counties experienced net business establishment growth. This surpasses the pre-Great Recession levels of startup activity.
This surge in entrepreneurship is partially attributed to government policies like the American Rescue Plan, which helped create an attractive environment for business formation. Additionally, pandemic-era financial support, particularly in ZIP codes with large Black populations, played a key role in doubling the Black business ownership rate between 2019 and 2022. Federal initiatives like the CHIPS and Science Act and the Inflation Reduction Act further promote small business growth, particularly in STEM-heavy sectors. This startup boom is expected to drive job creation, productivity growth, and wage increases in the years ahead.
