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Small firms accounted for half of net job creation, third quarter 2020–third quarter 2025
May 07, 2026
National Small Business Week, May 3 to May 9 this year, celebrates the contributions of small businesses to our economy. Small businesses (those with fewer than 250 employees) accounted for 51 percent of total net job creation from the third quarter of 2020 to the third quarter of 2025, highlighting their role in driving employment growth.
| Quarter | Small firms (249 or fewer workers) | Large firms (250 or more workers) | Total (all firm sizes) |
|---|---|---|---|
Q3 2020 | 2,073,000 | 1,966,000 | 4,039,000 |
Q4 2020 | 831,000 | 1,040,000 | 1,871,000 |
Q1 2021 | 1,181,000 | 611,000 | 1,792,000 |
Q2 2021 | 962,000 | 68,000 | 1,030,000 |
Q3 2021 | 667,000 | 772,000 | 1,439,000 |
Q4 2021 | 1,361,000 | 1,395,000 | 2,756,000 |
Q1 2022 | 570,000 | 1,049,000 | 1,619,000 |
Q2 2022 | 337,000 | 9,000 | 346,000 |
Q3 2022 | 346,000 | 1,045,000 | 1,391,000 |
Q4 2022 | 341,000 | 139,000 | 480,000 |
Q1 2023 | 639,000 | 485,000 | 1,124,000 |
Q2 2023 | 176,000 | 144,000 | 320,000 |
Q3 2023 | -103,000 | -8,000 | -111,000 |
Q4 2023 | 358,000 | -8,000 | 350,000 |
Q1 2024 | 243,000 | 401,000 | 644,000 |
Q2 2024 | -108,000 | -17,000 | -125,000 |
Q3 2024 | -127,000 | 165,000 | 38,000 |
Q4 2024 | 258,000 | -8,000 | 250,000 |
Q1 2025 | 66,000 | 267,000 | 333,000 |
Q2 2025 | -147,000 | -235,000 | -382,000 |
Q3 2025 | -213,000 | 4,000 | -209,000 |
Labor market dynamism, or the flow of jobs in and out of businesses, is much higher at small firms than at large firms. BLS data show that since 1993, small businesses have accounted for slightly less than half of all private sector employment. However, over the same period, small businesses have accounted for about 71 percent of gross job gains and gross job losses, highlighting their significant role in labor market reallocation and creative destruction.
These data are from the Business Employment Dynamics program. For more data like these, including employment and job gains and losses by firm size, see National Business Employment Dynamics Data by Firm Size Class.
SUGGESTED CITATION
Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Small firms accounted for half of net job creation, third quarter 2020–third quarter 2025 at https://www.bls.gov/opub/ted/2026/small-firms-accounted-for-half-of-net-job-creation-third-quarter-2020-third-quarter-2025.htm (visited May 07, 2026).
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