Research 2024: Popular businesses to start in USA
Do you have an idea to start a business, but don’t know what types of businesses can be popular with good the rest characteristics like revenue, and prospects?
Let’s use the experience of entrepreneurs and analyze the official statistics of the USA, to understand what type of businesses and industries are the most popular for starting a business in the USA.
The statistical data used in this article covers the years 2021–2023, the most recent period available at the time of writing.
Various types of businesses can be registered in the USA:
| Business Structure | Ownership | Liability | Taxes |
|---|---|---|---|
| Sole Proprietorship | Single owner | Unlimited personal liability | Self-employment tax, Personal income tax |
| Partnership | Two or more partners | Unlimited personal liability (except for limited partnership) | Self-employment tax (except for limited partners), Personal income tax |
| Limited Liability Company (LLC) | One or more owners | Owners have no personal liability | Self-employment tax, Personal or corporate tax |
| Corporation – C Corp | One or more shareholders | Owners have no personal liability | Corporate tax |
| Corporation – S Corp | Up to 100 shareholders (all must be U.S. citizens) | Owners have no personal liability | Personal income tax |
| Benefit Corporation | One or more shareholders | Owners have no personal liability | Corporate tax |
| Nonprofit Corporation | One or more members | Owners have no personal liability | Tax-exempt (profits cannot be distributed) |
Popular businesses to start in USA: Analysis of business structures
Let’s explore the most popular types of business structures in the USA for both businesses with and without employees.
According to the official statistical data among establishments (firms with employees):
- Corporation-S (45%) and Corporation-C (25%) are the most popular business registration forms;
- Partnerships (12%) and Sole proprietorship (10%) also take their place in the business structures;
- Non-profit organizations can be opened for specific purposes, so they are not so popular (7%).
However, if you prefer to start a small business without employers, it is better to choose Sole proprietorship, as 86% of entrepreneurs, launched nonemployer firms.
82% of all business structures in the USA are firms without employees, with individual proprietorships ranking first.
Popular businesses to start in USA: Analysis of business industries
In addition to the business structure, it’s equally important to understand which industries are popular. Let’s examine the number of firms by industry opened in the USA, both with and without employees.
Firms with employees, number in %:
According to the official statistics, most people start businesses in professional, scientific, and technical services, which account for 14% of all firms with employees.
Other popular business sectors include construction (13%), health care and social assistance (11%), and retail trade (10%).
These sectors employ the largest number of corporations, partnerships, and other business entities with employees in the United States.
Nonemployer firms structure, number in %:
As we showed earlier, 82% of all business structures in the USA are firms without employees, with individual proprietorships ranking first.
Among these firms, as in companies with employees, the most popular sectors are professional, scientific, and technical services (14% of all firms without employees).
Other notable sectors include transportation and warehousing (12%), construction (11%), real estate and rental, leasing (11%), other services (10%), and administrative and support services (9%). These industries are particularly popular choices for starting firms without employees.
Popular businesses to start in USA: Analysis of sales & revenue
The number of firms opened is an important indicator; however, let’s also examine the revenue levels of each industry to better understand their prospects.
Average Sales per Firm Among Employer Businesses ($000)
Firms with employees achieve the highest average sales volumes per firm in wholesale trade ($43.9M), manufacturing ($29.3M), finance and insurance ($23.4M), and retail trade ($10.9M).
In contrast, the sectors with the smallest average sales volumes per firm are accommodation and food services ($2.1M) and real estate, rental, leasing ($2.6M).
Popular businesses to start in USA: Analysis of payroll and number of employees by industry
Salary expenses are among the most significant costs for most businesses. Therefore, it is worth analyzing which industries have the highest payroll expenses per employee.
Based on statistical data, the highest average annual salaries per employee are observed in the fields of finance and insurance ($110K), professional, scientific, and technical services ($91K), and wholesale trade ($82K).
In contrast, the lowest average annual salaries per employee are found in the accommodation and food services sector ($24K) and retail trade ($36K).
What about the number of employees per company? Let’s also describe this information.
The average number of employees per company is highest in the manufacturing industry (51 employees) and lowest in the real estate, rental, leasing sectors (7 employees).
Conclusion: Popular businesses to start in USA
Based on the analysis of statistical data from 2021–2023, the most popular businesses to start in the USA are in industries such as professional, scientific, and technical services, which account for a significant portion of both employer and nonemployer firms. Other popular sectors include construction, healthcare and social assistance, and retail trade. These industries are not only abundant in terms of the number of firms but also show strong potential for growth.
For entrepreneurs looking to start a business with employees, sectors like wholesale trade, manufacturing, and finance and insurance offer the highest average sales per firm, with annual sales reaching into the tens of millions.
These industries also provide relatively high payroll expenses, particularly in finance and insurance, where employees earn an average of $110K annually.
On the other hand, industries like accommodation and food services, as well as real estate and rental, leasing, tend to have lower average sales and employee salaries. However, these sectors still represent a considerable portion of businesses in the nonemployer category, which offers lower startup costs and fewer operational complexities.
In terms of business structure, those looking to avoid employees should consider Sole Proprietorship, which is the most common form for nonemployer firms. For those willing to hire, focusing on sectors with higher sales volumes and salaries such as wholesale trade, manufacturing, and finance could yield the best results in terms of profitability and business growth.
Therefore, based on the statistical information, the most popular and potentially profitable industries to start a business in 2024 are finance and insurance, professional services, wholesale trade, and manufacturing, with a focus on high-revenue and high-payroll sectors.
About the Author
Kateryna Moskovenko
Financial Consultant with 14 years experience in accounting, management accounting, and financial modeling; Founder of Fiscra; Author of courses and trainings in financial modeling, business planning, and entrepreneurship; prepared more than 50 financial models for startups.
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