Colorado Small Business Statistics (2022)

Colorado is a state on the rise economically. For some years now, the major urban regions around the state have undergone exceptional expansion, offering additional economic prospects for entrepreneurs of all backgrounds.

Entrepreneurs in the state are thrilled about the fast-paced economic climate in which they operate, and they are generally positive about the Centennial State’s future. Colorado has consistently been ranked as one of the best states for business due to the government’s pro-business stance, a constantly growing economy, a thriving labor market, supportive communities, manageable business taxation, minimal business regulations, and the natural beauty and outdoor lifestyle that everyone craves.

Here are some small business statistics from Colorado that will shed some light on Colorado’s vibrant business scene.

Quick Colorado Small Business Statistics for Entrepreneurs

  • Small businesses make up 99.5% of all Colorado businesses.
  • Small business employees account for 48% of all Colorado employees.
  • Veterans make up 6.3% of small business employees and own 7.4% of businesses.
  • Women own 44.5% of small businesses in Colorado.
  • Racial minorities make up 12.1% of small business employees and own 7.4% of businesses.
  • The median household income in Colorado is $38,226.
  • According to the annual CNBC Top States for Business report, Colorado scored an A in the adoption of technology and innovation but also scored a D+ in the cost of doing business.
  • The management of companies and enterprises sector is the smallest industry in Colorado with only 380 small businesses operating in it.
  • Small businesses account for 87.2% of all export businesses in Colorado.
  • The total number of small businesses in Colorado is 2.07% of all US businesses.

Colorado Small Business Statistics

1. What is considered a small business in Colorado?

The US Small Business Administration sets industry-specific small firm size guidelines, but usually defines a small business as one with fewer than 500 people in manufacturing and less than $7.5 million in annual sales in most non-manufacturing enterprises.

There are currently 674,741 small businesses in the state of Colorado and they represent 99.5% of all businesses. 

2. How many Coloradans are employed by small businesses?

There are 1.2 million people employed by small businesses in Colorado. They account for 48% of all employees in the state. The minimum wage applies to most employees in Colorado, with limited exceptions including tipped employees, some student workers, and other exempt occupations. The maximum amount of tip cash that can offset the minimum wage for tipped employees is $3.02 per hour.

3. Colorado small business statistics by industry

There are 118,119 small businesses in the professional, scientific, and technical services sectors. Cumulatively, they are the largest industry in the state. The real estate, rental, and leasing sector is the second-largest industry with 78,094 small businesses currently operating within it.

The management of companies and enterprises sector is the smallest in the state with only 380 small businesses. 

4. Colorado small business ownership by ethnicity

According to data provided by the State Demography Office, the population of Colorado currently stands at 5,893,634 residents. White/Caucasian citizens make up 68% of all Coloradans followed by Hispanic/Latino (22.01%), Black/African American (4.16%), Asian/Pacific Islander (3.91%), and American Indian (0.76%).

The data below show how small business ownership is distributed among these races:

  • White/Caucasian — 588,868
  • Hispanic — 68,039
  • Asian — 18,500
  • Black or African American — 18,000
  • American Indian and Alaska Native — 1600
  • Native Hawaiian and Other Pacific Islander — 550

5. Colorado small business ownership by gender

Men own the majority of small businesses in Colorado. Data released by the Census Bureau’s Annual Business Survey Program indicate that there are 353,111 small businesses owned by men. Of these, 274,000 are non-employee businesses while another 79,111 have employees.

Women own 244,479 small businesses, with 214,000 of these being non-employee businesses while 30,479 have employees.

There are 38,460 small businesses that are owned by both men and women.

6. How COVID-19 has affected small businesses across Colorado

A survey conducted by the National Research Center and the Colorado Office of Economic Development and International Trade (OEDIT) on the early impacts of the pandemic

and initial recovery strategies shows that 23% of businesses with 100–499 employees were forced to shut down at the height of the pandemic in 2020.

Those that managed to stay open reported a 60% reduction in sales and 27% reported a 30% reduction in their workforce. On almost every metric, small firms did worse than larger corporations. They were less prepared for the pandemic, had less reserves, and faced more sales and income shortages for the year.

7. Small business financing in Colorado

As you begin your search for small business funding in Colorado, here are some of the top local funding options to explore:

  • Colorado Enterprise Fund: The Colorado Enterprise Fund is a nonprofit organization that focuses on small business funding. One of the most significant advantages of working with this lender is that they will do more than just give you a loan. They will also provide you with a support system that includes small business counseling, online resources, and training to assist you in reaching your business objectives.
  • Colorado Lending Source: The microloans, dubbed “Colorado Main Street” loans, range from $5,000 to $50,000. They are offered to small business owners who are unable to obtain a traditional loan to establish or develop their company. The Main Street loan offers a fixed interest rate and an eight-year duration in most Colorado counties, including the city and county of Denver.
  • Colorado Business Loan Fund: The Colorado Office of Economic Development and International Trade manages the Colorado Business Loan Fund (OEDIT). OEDIT manages 14 regional business lending programs that support small business owners throughout the state. Most small business owners who apply to the business loan fund want to borrow more than $100,000. However, if your loan request is less than $100,000 and you have five or fewer workers, you may qualify for a microenterprise loan.

8. Colorado business taxes

Despite attempts at the statehouse to simplify its tax code, Colorado is ranked 20th on the Tax Foundation’s 2022 State Business Tax Climate Index. Colorado rates higher than other states in terms of corporate and individual taxes, but it ranks lower in terms of sales tax, property tax, and unemployment insurance tax when compared to other states.

9. Colorado small business challenges

Here are the two major problems that plague small businesses in Colorado:

  • Hiring qualified employees: Despite a literacy rate of 90.10% and a large number of fresh graduates from Colorado’s several universities, hiring skilled, diligent staff is difficult. Benefits packages offered by small enterprises will rarely be able to compete with those offered by giant corporations. Furthermore, although large corporations may recruit workers to perform a single activity, small enterprises may require personnel who can perform many duties. They’ll also likely want workers with the personality traits required to flourish in a small business setting where change is common. All of these reasons might make it difficult to hire qualified staff.
  • Advertising: Promoting a business is costly, and word of mouth can only get you so far. The internet makes it possible to discover clients without spending a fortune, yet many small businesses don’t make use of it. You presumably already have a website, but is it SEO-friendly? Is it built with responsive design in mind? Is it generating sales or is it just an internet billboard? And your website is only a small part of your overall internet presence. You should also think about social networking sites like Facebook and Twitter, as well as review sites like the Better Business Bureau, where one unhappy consumer may ruin your reputation.

Small business owners can mitigate these issues simply by finding the right registered agent in Colorado.

A good registered agent will help you find the best employees for your business, help you with your online presence by designing a responsive website, and make sure that your business is in compliance with the Colorado Secretary of State’s office.

Read my review of the best registered agents in Colorado to find out which company is the best choice for your business.

10. Colorado small business export statistics

In 2019, there were 5,921 recognized businesses in Colorado that exported items worth $7.7 billion. Small businesses made up 5,163 of those exporters, or 87.2%. Small businesses shipped $2.1 billion in products, accounting for 26.9% of total exports by acknowledged businesses.

The Final Word

Colorado entrepreneurs are enthusiastic about the fast-paced economic climate in which they operate, and they are generally positive about the state’s future. These statistics reflect this economic development and should help any aspiring entrepreneurs understand the business climate in the state of Colorado.

Sources

Small Business Statistics By State

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