More prospective new businesses were formed in 2020 than ever before

Baboonie Tatum, owner of the Rise and Grind Cafe, poses inside her coffee shop in Milwaukee, Wisconsin. Kamil Krzaczynski/AFP via Getty
  • Bloomberg reports that the number of prospective businesses filing formation paperwork was almost a quarter higher in 2020 than 2019, citing a Census Bureau analysis of federal tax documents.
  • While paperwork initially dropped after lockdowns began in March, it began to pick up in June.
  • University of Maryland economist John Haltiwanger told Bloomberg that 2020 had the “highest annual total on record.”
  • Some may be creating businesses after losing a job:Over 10 million Americans are unemployed, and the unemployment rate in December was 6.7%.
  • Small businesses have found themselves in a tough position as bigger businesses boom, but the rise in new business formation – and the possibility they will bring in new employees – is promising.
  • For those looking to start a business right now, industries like fitness equipment, contactless food ordering, and educational technology are all strong bets.
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