The number of new business startups increased at the end of 2010, the U.S. Small Business Administration reported.

That growth, along with the expansion of existing businesses, led to net employment increases in the last three quarters of 2010, the latest period data was available, according to the SBA's Office of Advocacy Small Business Quarterly Bulletin.

In the fourth quarter of 2010, firms with fewer than 20 employees added 38,000 net new jobs, while firms with more than 500 employees added 304,000, the data showed.

The SBA said in the small business category of firms with 20-499 employees, new job creation also decelerated from the previous quarter. It is not clear if this was a pullback from the strong third quarter of 2010, or the beginning of a new trend, wrote SBA economist Brian Headd.

“As one would imagine, the beginning of the downturn wiped out many shaky businesses,” Headd said. “There was concern that such a long economic storm would overcome even stronger firms. It is encouraging that the latest data on establishment deaths and business bankruptcies show steady declines since 2009.”

Still, as unemployment remains high, Headd said the latest data for small business on job creation and startups “indicate a continuing but choppy climb from the depths of the recession.”

Instant Insights /

SBA Reports Growth of Startups

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