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Almost all American employers are a small business – 24/7 Wall St.

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When it comes to defining a small business, most of us think really small. And we would be right. How a small business is defined makes a big difference. Using one set of standards, a small business would have no more than four employees, while in another set, 500 employees is the threshold.

A new report from the Congressional Research Service presents data for non-farm employers for 2019, with several data points broken down by number of employees. The report is titled “Small Firm Size Standards: A Historical Analysis of Contemporary Problems. “

The following table presents summary data on the number of US businesses broken down by number of employees. Data on the U.S. self-employed was not included because it was not available for 2019. In 2018, 26.49 million Americans were self-employed.

Number of employees / company Number of companies Cumulative percentage of total companies Total employment Cumulative percentage of total employment Annual pay Cumulative percentage of payroll
0–4 3,556,927 61.6% 5,632,339 4.3% $ 283.5 billion 3.4%
5–9 959 641 78.3% 6,329,828 9.3% $ 257.6 billion 7.5%
10–19 609,355 88.8% 8 211 284 15.7% $ 347.8 billion 12.3%
20–99 532,972 98.0% 20 893 780 31.8% $ 960.9 billion 25.6%
100-499 92,159 99.6% 18 235 627 46.0% $ 1.01 trillion 39.5%
500+ 20,256 100.0% 69 695 369 100.0% $ 4.4 trillion 100.0%
Total 5,771,290 128 898 227 $ 7.23 trillion

We note a few notable data points:

  • Over 60% of all US businesses have four or fewer employees.
  • Barely 0.4% of all businesses have more than 500 employees.
  • The largest companies employ 54% of Americans.
  • The largest companies pay 60.5% of all US wages.

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