Entrepreneurship
The Great American Start-Up: 2025 Set a Record, and 2026 Is Running Hotter
Americans filed more applications to start a business last year than in any year on record. This year is on pace to beat it. Here is who is starting, where, and what the numbers quietly reveal.
Before the storefront, before the first client, before anyone outside the founder's kitchen knows a business exists, there is a form. It is an application for a federal tax ID, and the U.S. Census Bureau counts every one.
Few signals in the economy arrive earlier or say more about the national mood. For five years, that signal has been climbing. In 2025, it reached a level the country has never recorded.
By the numbers
A record year, then a faster one
By our count of the Census Bureau's monthly data, Americans filed 5,671,836 applications to start a business in 2025. That beat the previous high of about 5.47 million in 2023, topped 2024 by 8.6 percent, and ran 62 percent above 2019, the last full year before the pandemic reshaped how people think about work.
2026 is not cooling off. From January through September, applications reached 4,927,840, up 15.3 percent from the same stretch of 2025. July alone brought 576,264 seasonally adjusted applications, the highest single month in the history of the series, clearing the old peak set in July 2020. September's 534,947 ranks fourth all time.
What began as a pandemic anomaly has hardened into a new baseline. Americans are not starting businesses at an unusual rate anymore. This is the rate.
The quiet detail: most of these founders are going it alone
Census also tracks a narrower group it calls high-propensity applications, the filings most likely to turn into businesses with a payroll. Those are not at a record. They totaled about 1.71 million in 2025, below the 1.85 million of 2023, and make up roughly 30 percent of all applications.
Only about 1 in 15 monthly applications lists plans to pay wages. In September, Census projected that roughly 29,000 of that month's applications would become employer businesses within a year.
Read that as a description, not a weakness. This is a boom of individuals. The growth is coming overwhelmingly from people building something small and personal: a consultancy, an online shop, a service run from a laptop at the kitchen table. Our companion piece on the solo economy follows that thread into the 32 million businesses with no employees at all.
A record number of ordinary people decided the barrier to starting was low enough to try. The tools that made it possible, cheap software, online payments, AI assistants, are the same ones available to anyone reading this.
Who is starting, and in what
Retail is the largest category by a wide margin, with 20.6 percent of 2025 applications, and it has grown 125 percent since 2019. Census's retail grouping includes online sellers, which explains much of that climb. Professional, scientific, and technical services, the home of consultants, designers, and specialists, came second at 13.5 percent and grew 67 percent over the same period. Construction followed at 9.2 percent.
The fastest risers since 2019 tell the same story of independent, skill-based work:
- Retail, including e-commerce: up 125 percent
- Professional and technical services: up 67 percent
- Accommodation and food: up 64 percent
- Administrative and support services: up 59 percent
- Health care and social assistance: up 57 percent
Where it is happening
The South dominates. In September 2026, it accounted for about 44 percent of all applications, more than the West and Midwest combined. The Northeast trailed with roughly 14 percent.
What the numbers do not tell you
An application is an intention, not a business. Plenty never take a first order, and many that do stay small by design. That is the honest reading of the data, and it is also the opportunity inside it.
The country has quietly accepted that anyone can start something. What separates the founders who earn from the ones who merely file is rarely capital or credentials. It is choosing a model that fits the hours they truly have, and refusing the offers that exist only to sell them a dream.
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Sources
- U.S. Census Bureau, Business Formation Statistics, September 2026
- U.S. Census Bureau, Business Formation Statistics, monthly data (annual totals are the sum of monthly figures)
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