Small businesses in the Northeast are more popular along the coast

Andrey Kamenov

Andrey Kamenov, Ph.D. Probability and Statistics

In several previous posts, we focused on finding regional patterns in the employment numbers changes for U.S. regions. Unsurprisingly, the lists are dominated by industries from the larger sectors, such as healthcare and education.

What we would like to do next is to examine the distribution of small businesses in the Northeast, both geographically and among industry sectors. In this series, we focus on the businesses falling into the first two columns of the County Business Profile data: establishments with fewer than 10 employees.

On the following chart, you can see the (interpolated) year-over-year changes in the number of small businesses for each of the four regions.

As you can see, the Northeast is one of two regions (along with the Midwest) where the growth in the number of small firms was not very significant in the early 2000’s. On the other hand, this region suffered the least from the crisis, falling by only around 13,500 in both 2008 and 2009 — the other regions saw decreases at least twice as large.

Next, we take a look at the map of the region. Being the most densely populated of the four, it should come as no surprise that the number of small businesses per 1,000 residents is lower on average than in the Midwest, for example. Vermont and New Hampshire are the two states where slightly higher numbers were registered.

Arguably the most interesting feature that can be seen on the map, however, is the significantly larger proportion of small businesses along the coast.

Another interesting chart is presented below, showing the fastest-growing NAICS subsectors. The top place is taken by limited-service restaurants, which added 3,383 new small establishments in the region since 2007.

Source: the US Census Bureau County Business Patterns data

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About Andrey Kamenov

Andrey Kamenov

Andrey Kamenov, Ph.D. Probability and Statistics

Andrey Kamenov is a data scientist working for Advameg Inc. His background includes teaching statistics, stochastic processes and financial mathematics in Moscow State University and working for a hedge fund. His academic interests range from statistical data analysis to optimal stopping theory. Andrey also enjoys his hobbies of photography, reading and powerlifting.

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