The Sunshine State has the third-largest population and the fourth-largest state economy in the United States. With 900 net new inhabitants arriving to Florida every day and a predicted population of 26 million by 2030, Florida is primed for continuous growth.
In 2018, the state’s economic growth rate surpassed that of the rest of the country, at a rate of 3.5%, compared to 2.9% nationwide.
Small companies are an important element of Florida’s economic landscape. In fact, entrepreneurs from all over the world continue to flock to Florida because of its business-friendly taxation system, access to massive consumer markets, international access by land, sea, and air, world-class infrastructure, healthy import/export market, and strong population and job growth.
Here are a few interesting small business statistics from the state of Florida:
Quick Florida Small Business Statistics for Entrepreneurs
- Small businesses represent 99.8% of all businesses in Florida.
- 41.1% of Florida employees work for small businesses.
- 94.6% of Florida exporters are small or medium-sized businesses.
- Florida Small Business Development Centers provided 112,164 hours of professional business counseling to 11,529 client firms in 2018, resulting in a $2.5 billion GDP impact on the Florida economy.
- Veterans account for 5.8% of all workers and control 6.3% of all small businesses.
- Racial minorities represent 23.5% of workers and own 18.7% of small businesses.
- Due to effects brought about by the COVID-19 pandemic, small businesses in Florida have received over 579,000 Paycheck Protection Program (PPP) loans totaling approximately $41 billion in assistance.
- The mining, quarrying, and oil and gas extraction sectors have the second-lowest number of small businesses, with only 1,041 currently invested in them.
- Since the third quarter of 2014, Florida has been the leading state in the number of new business applications in the United States.
- Only 80% of businesses in Florida established in 2020 will survive one year, 50% will make it to 2025, and only one-third will be around in 2030.
Florida Small Business Statistics
1. What is considered a small business in Florida?
A small business is a privately held company, partnership, or sole proprietorship with fewer employees and lower yearly income than a corporation or regular-sized firm. According to the US Small Business Administration, a small business is generally defined as a business with fewer than 500 employees.
There are currently 2.8 million small businesses in Florida that represent 99.8% of all businesses in the state.
With more than 100 start-ups per 1,000 firms, Florida has the second-highest density of start-up businesses in the United States. A slew of new businesses are flocking to or establishing themselves in the state, most notably in Miami.
2. How many Floridians are employed by small businesses?
There are 3.6 million small business employees in Florida, who account for 41.1% of all employees in the state.
The state minimum wage in Florida is $10.00 per hour. This is more than the federal minimum wage of $7.25 per hour. Employees have the right to claim the higher state minimum wage. Most employees in Florida receive the minimum wage, with a few exceptions, such as tipped employees, some student workers, and some exempt occupations.
The hourly tipping pay is $6.98. In November 2020, a voter-approved proposal will progressively raise the minimum wage rate to $15.00 per hour. The next raise, to $11.00, is scheduled for September 2022.
3. Florida small business statistics by industry
The professional, scientific, and technical services industries are the largest in Florida with a total of 361,923 small businesses currently invested in these industries. They are followed by the administrative, support, and waste management industries, which comprise around 335,986 small businesses.
The management of companies and enterprises sector is the smallest in the state, with just 664 small businesses working within it.
4. Florida small business ownership by ethnicity
According to the 2019 US Census data, Florida’s population was 21.5 million people, with a median age of 42.4 and a typical family income of $59,227. The seven ethnic groups in Florida are white (53%), Hispanic (21.6%), Black or African American (15.2%), Asian (2.73%), multiracial (2.03%), Native Hawaiian and other Pacific Islander (0.0648%), and American Indian and Alaska Native (0.0782%)
Here is a breakdown of small business ownership among these ethnicities:
- White/Caucasian — 2,102,894
- Hispanic — 782,164
- Black/African American — 351,521
- Asian — 117,280
- American Indian and Alaska Native — 5,520
- Native Hawaiian and Other Pacific Islander — 1,800
5. Florida small business ownership by gender
According to the Annual Business Survey conducted by the US Census Bureau, there are 1,034,013 businesses owned by women in Florida. Of these, 935,000 are non-employee businesses while 99,013 are employee businesses.
Men own a total of 1,422,301 small businesses with 1,155,000 being non-employee businesses and another 267,301 with employees.
There are 128,307 small businesses owned by both men and women.
6. Business Taxes in Florida
Florida has a reputation for having a low overall tax rate. It is one of just seven states in the United States without a personal income tax, making it a popular choice for pass-through enterprises like LLCs.
At 6%, the state sales tax is in the middle of the pack when it comes to taxes on rented or purchased items. This does not include basics like groceries and medications. Corporations must submit a corporate income tax return in Florida, although the highest rate is just 5.5%.
7. Small business financing in Florida
In addition to the state’s 150 banks, venture capitalists and angel investors have invested considerable sums of money in the state. Here are a few financing options in Florida for entrepreneurs who are looking for capital to kick start their businesses:
- Enterprise Florida Microfinance Guarantee Program: Enterprise Florida is a public–private collaboration of Florida’s corporate and government leaders that serves as the state’s primary economic development organization. This venture funding organization provides loans to small businesses from $50,000 to $250,000 with a guarantee of up to 50% of the loan amount. These loans carry repayment terms of up to three years. The only basic requirement is that your small business must have 25 or fewer employees and have generated an average annual revenue of $1.5 million or less in the last two years.
- Florida Black Business Loan Program: Small business loans are available to Black business owners based in Florida through this program. These Florida small company loans can range from $2,500 to $75,000, with loans up to $150,000 available in certain situations, however the program doesn’t specify what those circumstances are.
- SSBCI Loan Participation: Loans and loan participations from the SSBCI Loan Participation Program are available to lenders and Community Development Financial Institutions (CDFIs) that issue small business loans to Florida businesses. This program offers small business loans ranging from $250,000 to $5 million with payback periods of up to five years. Small business loans of up to $250,000 will also be considered on an individual basis.
8. Florida small business challenges
Running a business is not without its ups and downs. Here is a list of problems that plague small businesses in Florida:
- Attracting and retaining a quality workforce: Small businesses in Florida must compete for employees with larger corporations. This is increasingly difficult in light of the gap in overall remuneration, particularly benefits, which leads to higher employee turnover. Demographic changes in the next few years may worsen these issues.
- Taxes and regulation: Certain business conditions have a significant influence on entrepreneurial activity, and small business owners in Florida commonly express anxiety about taxes and regulations despite Florida having one of the best tax rates in the country. In the future, officials must evaluate the impact of taxes and regulations on small company owners and would-be entrepreneurs.
- The overall economy: Small businesses in Florida continue to struggle in the current economic slump, and policymakers will need to act quickly to get the economy rolling again. Small firms will play a significant role in this, since entrepreneurs will drive fresh innovation and job creation in the future years. These businesses will continue to be the job creators that we have come to expect. Having said that, different businesses will recover from the slump in different ways, and certain industries have definitely been struck worse this time around than in previous business cycles.
You can, however, counter some of these problems by simply finding a genuine registered agent in Florida. A good registered agent will not only offer assistance with your employee hiring issues, but will also take care of your tax filing problems so that your business is always in compliance with the Florida Secretary of State’s office.
Read my review of the best registered agents in Florida to find out which one is best for your business.
9. Florida small business export statistics
In 2019, 57,846 businesses in Florida exported items totaling $51.4 billion. Of those, 54,724 (or 94.6%) were small businesses. Small businesses shipped items worth $29.2 billion, representing 56.7% of total exports by recognized businesses.
The Final Word
Because of its pro-business state tax policies, low cost of doing business, and simplified regulatory environment, Florida routinely ranks among the top states for business. Government and economic development officials are always working together to keep the state’s business climate attractive for businesses of all sizes.
Sources:
- US SBA – Small Business Profiles
- Florida SBDC – Small Business Report
- Florida Tax Watch
- Florida Chamber of Commerce
- Florida Division of Corporations
- Data USA – Florida
- American Community Survey
- US Census – Non-Employer Statistics