Visualizing America’s Entrepreneurial Spirit During COVID-19

Mapped: America’s Entrepreneurial Spirit During COVID-19

Despite the risks of opening a business during a global pandemic, new data from the U.S. Census Bureau reveals that the entrepreneurial spirit is alive and well in the United States.

In total, there were 492,133 new business applications in January 2021—an increase of over 73% year-over-year (YoY).

The region with the highest growth rate was the South at 84% with more than 220,000 new business applications in the region in January of this year. Mississippi had the highest percent increase at 164%, with over 6,000 new applications in January 2021.

Here’s a closer look at the number of total applications by state and region:

Notably, new business applications have soared in the last month or so, bouncing back from a dip between July and December 2020.

The growth rate from December 2020 to January 2021 stood at 42.6%, with the biggest change happening in the Midwest, where applications have gone up 48.6%. Here’s a look at the biggest changes in applications by region since December 2020:

Region	Number of Applications in January 2021	Percentage Change from December 2020
Midwest	85,503	48.6%
Northeast	77,910	47.9%
West	103,861	40.5%
South	224,859	39.6%

Note: Business applications are measured by collecting data on new applications for Employer Identification Numbers with the U.S. government.

Opportunity Out of Crisis

Prior to the pandemic, new business startups were actually on the decline, but in times of crisis there is often opportunity.

People have become wildly innovative during COVID-19, partly because they were forced to do so due to job or income loss. Economists call this ‘creative destruction,’ wherein new innovation springs up because of the failure of particular industries or businesses.

Here’s a look at new business applications by industry.

Industry	Number of New Business Applications (Jan. 2021)
Retail Trade	101,842
Professional Services	56,280
Construction	43,724
Other Services	43,511
Transportation and Warehousing	41,320
Administrative Support	32,765
Accommodation and Food Services	27,409
Health Care and Social Assistance	27,266
Real Estate	23,804
Finance and Insurance	22,607
Arts and Entertainment	14,407
Unclassified	13,442
Wholesale Trade	10,298
Information	9,907
Manufacturing	7,420
Educational Services	6,790
Management of Companies	4,273
Agriculture	3,978
Mining	585
Utilities	505

Creative destruction has been keenly exemplified in the rise of remote and digital services over traditional brick and mortar stores. In fact, the industry with the highest number of new business applications in January 2021 was retail services, mostly online, with over 101,000 applications.

Feeling the Entrepreneurial Spirit?

As business applications are on the rise, more jobs could potentially be created in the U.S., and competition will likely increase as well. While starting a business during COVID-19 is risky, it could have immense payoffs for the individuals involved and the overall economy.

In fact, a piece from the U.S. Chamber of Commerce actually recommends specific business ideas that are ‘pandemic-friendly.’ Among many virtually-based ideas, the list includes:

• Digital marketing
• App development
• Fitness and wellness services
• Box subscription services

Perhaps, for digitally minded entrepreneurs, there has never been a better time to start a business.