Small Businesses’ Share of Total Revenue is Falling Behind
June 12, 2024
Delaney Sexton
Contributing Editor
Small Businesses’ Share of Total Revenue is Falling Behind
Receipts are defined as “operating revenue for goods produced or distributed or for services provided.” In 1963, small businesses had receipts of $3.26 trillion, making up 56.8% of all receipts. Since then, larger businesses have been able to grow much quicker and significantly outpace small business receipt growth. In 2017, small business receipts did grow to $13.18 trillion, but small businesses only accounted for 35.6% of all receipts.
Small businesses in certain sectors had greater declines in receipts. From 2002 to 2017, health care and social assistance had the largest drop in its share of receipts. This is followed by retail trade, education services, and wholesale trade having the greatest drop in receipts. However, some sectors’ receipts did grow. Management of companies and enterprises had the biggest increase in receipts during that period. Mining, quarrying, and oil and gas extraction; utilities; and transportation and warehousing also increased.
On a state level, only three states had an increase in small businesses’ share of receipts: South Dakota, Delaware, and Louisiana. The remaining states all declined. States with the most notable declines in receipts were North Dakota (17.8% decrease) and Rhode Island (13.3% decrease).
While receipts have fallen over the last few decades, the pandemic may have turned this trend around. With the rise in new business applications and their contributions to job recovery, small businesses could regain their share of receipts.