Last year, an estimated 552,600 new employer firms opened for busi-ness and 660,900 firms closed shop, according to new data released today from the SBA.
The agency's Office of Advocacy provided an update of small businesses statistics. Among them, seven out of 10 new employer firms survive at least two years, half at least five years, a third at least 10 years, and a quarter at least 15 years. In 2009, there were 27.5 million businesses in the United States.
Small businesses rely heavily on owner investment and bank credit, averaging about $80,000 a year for young firms, the SBA said. Startups rely about equally on owners' cash injections into the business and bank credit while young firms receive about three-quarters of their funds from banks via loans, credit cards and lines of credit. One-tenth of startups and about a third of young firms do not use capital injections.
Small firms, usually defined as those with fewer than 500 employees, accounted for 65% or 9.8 million of the 15 million net new jobs created between 1993 and 2009. Much of the job growth is from fast-growing, high-impact firms, which represent about 5% to 6% of all firms and are on average 25 years old.
Citing Federal Reserve Board data, the SBA said that by mid-2010, commercial banks began to ease tight lending conditions on small businesses that had begun in early 2007. Credit has con-tinued to flow as loans under $1 million totaled $695 billion in fiscal year 2009. After declining over the past few years, ven-ture capital investment dollars increased in mid-2010.