Updated October 2022

1. Why is there missing data for some years and regions and not others?

Calculations are provided for regions, year, and business age groups for which the underlying data are available. There may be missing data related to coverage in the underlying data.

2. How can I interpret the New Employer Business series?

In 2021, the national rate of new employer business actualization was 9.16%, meaning that for every 100 new business applications, about 9 businesses achieved a first payroll within eight quarters. 

The rate of new employer businesses reflects the emergence of new employer businesses in the population. The national rate of new employer businesses was 0.15 in 2021, meaning there were 140 new employer businesses for every 100,000 people. 

New employer business velocity is the average amount of time it takes, in quarters, for a new business application to become an employer (make a first payroll), assuming it does so within eight quarters. In 2017, the national new employer business velocity was 2.06, indicating that, on average, approximately six months pass between business application and first hire. 

Employer business newness captures new employer businesses as a share of all employer firms. In 2019, national employer business newness was 6.98%, meaning that about 7 out of every 100 employer businesses were new businesses applications that made a first payroll within the first eight quarters.

3. How can I interpret the Early-Stage Entrepreneurship series?

The rate of new entrepreneurs in 2021 was 0.36%, which reflects that 360 out of every 100,000 adults became new entrepreneurs in an average month. The rate of new entrepreneurs captures the percentage of the adult, non-business owner population that starts a business each month. This indicator captures all business owners, including those who own incorporated or unincorporated businesses, and those who are employers or non-employers.

The opportunity share of new entrepreneurs was 80.9% in 2021. Opportunity entrepreneurs are defined as those starting a business out of wage and salary work, school, or other labor market status. Necessity entrepreneurs are defined as those starting a business out of unemployment.

The startup early job creation indicator was 4.74 per 1,000 people in 2021 (meaning that startups created, on average, about 5 new jobs for every 1,000 people in the United States). This indicator measures how many jobs are created by startups in their first year, normalized by the total population. This allows us to track the total number of jobs created by startups while accounting for differences in population over time or by geography.

The startup early survival rate in 2021 was 81.7%. This reflects that roughly 4 out of 5 new establishments were still active after one year of operation.

More detailed information about historical trends and interpretations of the indicators can be found in the National and State reports.

4. Why did the national values for the rate of new entrepreneurs and the opportunity share of new entrepreneurs diverge from average state values in 2021?

To increase the precision of the estimates, three-year moving averages are used in the construction of the state and demographic values for the rate of new entrepreneurs and the opportunity share of new entrepreneurs. For example, the rate of new entrepreneurs for a state (or demographic category) in 2021 is calculated by summing the rate of new entrepreneurs for that respective state in 2019, 2020, and 2021, and then dividing by three.

The sample sizes for the national estimates are large enough that one year of data is sufficient. Therefore, national values use one year of data whereas the state and demographic values are constructed using three-year moving averages for the rate of new entrepreneurs and the opportunity share of new entrepreneurs. Because three-year moving averages do not move as quickly as the estimates with one year of data, the state and demographic values for 2020, when COVID-19 occurred, do not change as much as the national values.

The other indicators in the Early-Stage Entrepreneurship series – startup early job creation, startup early survival rate, and the KESE index – are not three-year moving averages.

5. What data sources are used to produce the Early-Stage Entrepreneurship series?

The U.S. Census’s Current Population Survey (CPS) and the Bureau of Labor Statistics (BLS) Business Employment Dynamics (BED) are the underlying data sources for the Early-Stage Indicators. The Business Formation Statistics (BFS), Business Dynamics Statistics (BDS), and Population Estimates Program (PEP) are the underlying data sources for the New Employer Business Indicators.

6. Do you have demographic data for individual states or for groups other than those presented on the website?

Due to constraints with the sample sizes of the source variables, we are unable to produce accurate measures for demographics at the state level. Nationally, we present all available demographic groups for which we can produce accurate estimates on the website.

7. How are demographic groups categorized in the Kauffman Indicators of Entrepreneurship?

The Kauffman Indicators of Entrepreneurship uses the same language for demographic categories as the underlying data sources.

8. Why do you not have demographic data for the startup job creation and startup survival rate indicators or any of the New Employer Business Indicators?

Those variables are produced using the BLS BED statistics and Census Bureau BFS statistics. These data sources do not include data on the demographics of who owns businesses. As such, we are unable to report demographic breakdowns for those indicators.

9. For how many years is data available? Is there additional data available for other years?

The website generally provides all of the data we have available. Generally, we have data back to 1998 for the two CPS-derived indicators (rate of new entrepreneurs and opportunity share), and 1996 for the two BED-derived indicators (startup job creation and survival rate). The New Employer Business Indicators are presented from 2005 through the most recent year of data available for each metric. 

10. Where can I download the data?

Go here to download the data for our three indicator series: Early-Stage Entrepreneurship, New Employer Business, and Entrepreneurial Jobs.

11. Can I download or print the data visualizations?

All data visualizations per indicator at the national and state levels are available to print in a consolidated report through your browser’s native printing functionality. For example, Chrome users can click on the three dots in the upper right portion of the browser and click “print.” You can also open a print dialogue box regardless of browser via CTRL + P for PC and COMMAND + P for Mac.

The data visualizations are also individually available for download by clicking the “Download Chart” link provided.

12. How can I print my state page?

The instructions to print and download the data visualizations from the previous question apply to the state pages, as well.

13. Why might an estimate on the website look a little different from an estimate in a report?

The data used to calculate indicators comes from underlying sources that are updated at different times throughout the year. In addition, some indicators use projected data that is updated with current data over time. This means there may be discrepancies during the time between report production and data updates to the website.

14. Why is Kauffman no longer ranking states or cities?

A major goal of the Kauffman Indicators is to provide useful measures for types and stages of entrepreneurs, as well as across geographies and demographic groups where possible. Individual stakeholders such as state policymakers and entrepreneurship support organizations may have different priorities and needs. Furthermore, small year-to-year variations in the indicators could result in larger shifts in the overall rankings, even if the underlying conditions are largely the same. As such, we felt that users could choose how to use and interpret each of the indicators or the index as appropriate for their needs.

15. What happened to the Kauffman Index?

In 2018, in order to provide information that was actionable and directly relevant to users, the Kauffman Foundation retired the Kauffman Index of Entrepreneurship and replaced it with the Kauffman Indicators of Entrepreneurship. The Kauffman Foundation received input from policymakers, researchers, and other stakeholders about how to accomplish clearer indicators, as well as provide timely and current information in the context of existing data constraints and a focus on the nature of entrepreneurship.

The Kauffman Indicators are intended to provide a broad and balanced perspective on measuring the complex phenomenon of entrepreneurship.

16. How can I provide feedback?

We’d love to hear it. Send feedback through the form below.

17. Is there someone at Kauffman who I can talk to about the data or reports?

Contact us here and we’ll connect you with the most appropriate person to answer your query.