C-Suite Wednesday – Business Formations are Up 10% in July

August 16, 2023

Delaney Sexton
Contributing Editor

C-Suite Wednesday – Business Formations are Up 10% in July

The trend of new business growth seen in the last few years continues in 2023. In July 2022, the Census Bureau’s business formation statistics showed that there were more than 425,000 business applications. Last month, there were over 469,000 business applications, an increase of about 10% from the year prior.

In July 2023, new business applications were most concentrated in the following industries:

  • Retail Trade – 77,604
  • Professional Services – 60,113
  • Construction – 50,605
  • Other Services – 40,592
  • Administrative and Support – 35,765

While most industries saw an increase in new business applications last month, a few industries had a decline in business applications compared to the year before. Included in the decline of business applications are the mining industry and the transportation and warehousing industry. Both industries did not see a significant drop, but they are the only two that did not support the overall growth pattern of new business applications.

The most notable year-over-year increase in business applications were in retail trade (+8,630 applications from July 2022 to July 2023), construction (+7,163 applications from July 2022 to July 2023), and professional services (+6,792 applications from July 2022 to July 2023).

Projected business formations in July of last year were 30,754. The Census Bureau showed a 4.4% increase in year-over-year growth with projected business formations at 32,115 in July 2023. Compared to June 2023, this is a slight decrease in projected business formations. Projected business formations mean that the Census Bureau believes that of all the business applications filed in July 2023, there are 32,115 business startups that will form within 4 quarters of applying.

Breaking down specific regions, the Northeast is projected to have a 4.6% increase in business formations within a year of applying. Projected business formations in the Midwest are expected to be up by 4.1%. There are minimal year-over-year increases in projected business formations in the South, only rising by 1.1%. Out in the West, projected business formations appear to be the most positive since the Census Bureau anticipates an increase of 9.1%.

Census Bureau Business Formation Statistics July 2022
Census Bureau Business Formation Statistics July 2023