SBA’s Office of Advocacy Celebrates Census’ Inaugural Nonemployer Business Owner Demographic Data Release
Release No. 20-04 ADV
WASHINGTON, D.C. – Today, the Office of Advocacy, an independent office within the U.S. Small Business Administration, highlights the U.S. Census Bureau’s first release from the Nonemployer Statistics by Demographics (NES-D), a new dataset partially funded by Advocacy.
NES-D shows how people are using entrepreneurship as a step towards empowerment and wealth building. Listing the number of nonemployer firms (businesses without employees) and their receipts by owner type such as race, Hispanic-origin, gender, and Veteran status, NES-D is a companion to Census’ Annual Business Survey, which lists employer firms (businesses with employees) by owner type.
Nonemployers are a unique segment of businesses. They represent about 80 percent of all businesses and account for less than 5 percent of all receipts. The growth in the number of nonemployers is outpacing employers. From 2000 to 2017, the number of nonemployers grew by 18 percent while employers declined by 1 percent.
Most owner demographic groups were reasonably represented as nonemployer business owners with their share of the total number of nonemployers similar to their share of the population. For instance, African Americans represent about 12 percent of nonemployers and about 13 percent of the population while Veterans represent about 6 percent of both. But there were discrepancies with the sizes of their operations. The average nonemployer (excluding C-corporations) had receipts of $47,000 in 2017, but the average of receipts for women ($27,000), Veteran ($42,000), African American ($22,000), and Hispanic ($36,000) nonemployers were well below the national average. Both Asian and White nonemployers individually averaged $48,000 in receipts.
“Advocacy is pleased to support the Census Bureau as they illustrate the role that entrepreneurship plays for underserved demographics,” said Acting Chief Counsel Major L. Clark III. “Advocates for African-Americans, Asians, Hispanics, women, and Veterans can use the nonemployer firm data to show the strides being made toward business ownership.”
|Nonemployer Firms and Receipts, 2017|
|* There are also “equally-owned”|
categories not listed.
Note that methodological changes in measuring owner demographics in NES-D versus the now discontinued Survey of Business Owners, which also produced nonemployer figures by owner demographic, make time trends difficult to interpret without further investigation.
Advocacy plans to use the NES-D data in upcoming reports. For Advocacy research on business owner demographics and other issues, please visit https://advocacy.sba.gov/category/research/. To view NES-D data, please visit the U.S. Census Bureau’s website, https://www.census.gov/programs-surveys/abs/data/nesd.html.