Small businesses play a vital role in local economies by driving job creation and growth, fostering innovation and entrepreneurship, meeting service demands, and contributing to local philanthropy and community identity. They operate across all industries, even if they are more concentrated in some, and because they are closely tied to labor markets and consumer demand, their health often reflects broader economic trends.
In this report, we examine the state of small businesses in Wisconsin and its metropolitan areas to understand their current characteristics, recent changes, and economic contributions, while also identifying strengths, weaknesses, and potential opportunities.
These key questions guide our analysis:
- How many small businesses are operating in Wisconsin and its metropolitan areas overall and by industry, how many people do they employ, and how have those numbers changed over time?
- What contributions do Wisconsin’s small businesses make to the state’s economy, particularly through payroll and sales?
- How do the characteristics and trends of Wisconsin’s small businesses compare with those nationally, and how do they vary across metropolitan areas within the state?
- What challenges and opportunities do these data reveal for small businesses in Wisconsin, and what policy or program changes could be considered in response?
To help answer these questions, we analyzed data from both federal and private sector sources, including the U.S. Bureau of Labor Statistics, the U.S. Census Bureau, and YourEconomy (a national data series developed by the Universities of Wisconsin Office of Business and Entrepreneurship). We supplemented our findings with input from small business development experts from across the state.
For this report, small businesses are defined as private establishments with fewer than 500 employees, which is generally consistent with the definition used by the U.S. Small Business Administration. In selected cases, we also provide detail for businesses with fewer than 100 and fewer than 10 employees.
We hope the insights from this analysis will assist policymakers, business and civic organizations, and other stakeholders in their efforts to strengthen existing small businesses and support entrepreneurship in Wisconsin.