California small business statistics
California produced 553,931 business applications in 2025, up from 2024 but still just below the 2023 peak. The state page is a split screen: very high filing volume, a cooler employer-likely application signal, a huge health-care establishment base, heavy SBA lending into retail and local services, and federal contract demand concentrated in R&D, aerospace, construction, and engineering.
Public source files covering California business formation, labor, lending, proprietor income, bankruptcy, and federal contracting.
What the data shows
The topline is uneven: filing volume is still enormous, the employer-likely signal is softer, and the largest county markets do not all look the same after adjusting for population.
California logged 553,931 business applications in 2025, up 7.1% from 2024 and 51.7% from the pre-pandemic 2019 baseline.
Through May 2026, total applications were up 9.4% from the same months in 2025; high-propensity applications were down 1.4%.
Los Angeles filed 172,540 applications in 2025, the largest county total in California. San Francisco and Sacramento led the top-volume counties after adjusting for population.
Health care added the most private-sector establishments and jobs since 2019.
SBA 7(a) and 504 approvals to California businesses reached $6.6B in FY2025 across 11,044 loans, led by retail trade, accommodation and food services, health care, professional services, and construction.
Business bankruptcy cases tied to California counties rose from 3,348 to 3,442 in the 12-month period ending March 31, 2026.
New business formation
California business applications reached 553,931 in 2025, up 7.1% from 2024. Through May 2026, applications were running 9.4% ahead of the same months in 2025.
The long comparison starts before the pandemic reset.
The 2019 comparison uses the last full pre-pandemic year. California’s shutdown period and the business churn that followed reshaped EIN filing patterns; high-propensity applications totaled 98,776 through May 2026, down 1.4% from Jan-May 2025. Projected business formations within eight quarters rose 7.0% over the same period.
Metric note: Census BFS counts applications for employer identification numbers. Applications are early filings; confirmed operating-business counts arrive later.
Where applications are concentrated
Los Angeles is the largest application market by raw volume. Among the high-volume counties shown below, San Francisco and Sacramento stand out most after adjusting for population.
Population-adjusted filing volume changes the county read.
The chart uses 2025 Census BFS applications divided by Census Vintage 2025 resident population estimates. Los Angeles still dominates raw filings in the table below, but San Francisco and Sacramento show higher application volume relative to resident population among these high-volume counties.
Metric note: Census BFS counts EIN applications. The denominator is 2025 resident population, not existing businesses, so this is a scale adjustment rather than a startup conversion rate.
| County | 2025 applications | Change vs 2024 | Change vs 2019 |
|---|---|---|---|
| Los Angeles | 172,540 | +4.1% | +34.7% |
| Orange | 49,945 | +6.6% | +35.0% |
| San Diego | 45,546 | +8.1% | +48.3% |
| Sacramento | 35,789 | +14.6% | +193.6% |
| Riverside | 29,037 | +5.0% | +67.4% |
| San Bernardino | 26,656 | +6.1% | +60.0% |
| Santa Clara | 24,043 | +7.9% | +49.7% |
| Alameda | 21,047 | +8.2% | +42.5% |
| San Francisco | 20,682 | +10.3% | +56.0% |
| Contra Costa | 14,264 | +6.9% | +53.6% |
| Fresno | 10,779 | +12.8% | +94.0% |
| San Mateo | 10,625 | +11.5% | +49.7% |
Jobs, establishments, and wages
In 2024, California had 1,812,802 private-sector establishments and 15,546,764 private-sector jobs in the QCEW annual file. Establishments grew 16.7% from 2019 to 2024; jobs grew 2.8%.
Health care is the establishment-growth story.
Health care and social assistance added 167,810 establishments from 2019 to 2024 and 404,568 jobs over the same period. Professional services was the next-largest establishment gainer.
QCEW tracks employer establishments. It is the recurring source here for jobs, wages, payroll, and local industry structure.
| Industry | 2024 establishments | Change vs 2019 | 2024 jobs | Change vs 2019 |
|---|---|---|---|---|
| Health care and social assistance | 791,359 | 167,810 (+26.9%) | 2,804,931 | 404,568 (+16.9%) |
| Professional services | 183,554 | 27,202 (+17.4%) | 1,408,800 | 74,822 (+5.6%) |
| Retail trade | 106,789 | 786 (+0.7%) | 1,586,477 | -72,406 (-4.4%) |
| Other services | 105,324 | 7,882 (+8.1%) | 571,787 | 23,815 (+4.3%) |
| Construction | 93,997 | 9,750 (+11.6%) | 913,470 | 27,802 (+3.1%) |
| Accommodation and food services | 93,732 | 5,471 (+6.2%) | 1,667,340 | -37,801 (-2.2%) |
| Real estate and rental | 65,966 | 8,319 (+14.4%) | 307,065 | 4,105 (+1.4%) |
| Wholesale trade | 62,833 | -1,967 (-3.0%) | 658,720 | -35,507 (-5.1%) |
| Administrative services | 58,657 | 4,020 (+7.4%) | 1,090,040 | -43,985 (-3.9%) |
| Finance and insurance | 52,125 | -208 (-0.4%) | 495,273 | -43,596 (-8.1%) |
SBA lending
SBA 7(a) and 504 approvals to California businesses totaled $6.6B in FY2025 across 11,044 loans. The SBA files report 112,613 jobs supported for those approvals.
Retail and local services drew the most SBA capital.
Retail trade, accommodation and food services, health care, professional services, construction, other services, manufacturing, and wholesale trade each cleared more than $400.0M in FY2025 SBA approvals.
SBA fiscal year 2025 ran from Oct. 1, 2024, through Sept. 30, 2025. The source package was current as of April 28, 2026.
| Sector | FY2025 loans | FY2025 approvals | SBA jobs supported |
|---|---|---|---|
| Retail trade | 1,373 | $982.1M | 9,074 |
| Accommodation and food services | 1,262 | $845.4M | 18,754 |
| Health care and social assistance | 1,134 | $796.9M | 13,752 |
| Professional services | 1,364 | $636.5M | 10,302 |
| Construction | 1,335 | $607.6M | 13,860 |
| Other services | 1,096 | $580.4M | 9,166 |
| Manufacturing | 667 | $552.3M | 8,042 |
| Wholesale trade | 647 | $486.1M | 4,829 |
| Transportation and warehousing | 434 | $249.4M | 5,478 |
| Arts and entertainment | 397 | $222.7M | 4,440 |
| County | FY2025 loans | FY2025 approvals | SBA jobs supported |
|---|---|---|---|
| Los Angeles | 3,266 | $2.0B | 32,636 |
| Orange | 1,185 | $710.9M | 12,087 |
| San Diego | 1,124 | $617.2M | 11,693 |
| Riverside | 607 | $349.7M | 5,740 |
| San Bernardino | 602 | $331.6M | 5,718 |
| Santa Clara | 430 | $255.1M | 4,767 |
| Alameda | 413 | $254.2M | 3,474 |
| Sacramento | 404 | $214.8M | 4,309 |
| Ventura | 271 | $150.8M | 2,882 |
| Fresno | 191 | $131.3M | 2,167 |
The unincorporated business economy
IRS SOI data show 3,708,687 California Schedules C and partnership returns/forms in Tax Year 2023. Those businesses reported $642.0B in gross receipts and $87.0B in the combined income/profit measure.
Sole proprietors account for most returns.
California had 3,294,809 nonfarm sole-proprietor Schedules C in Tax Year 2023, with $206.9B in gross receipts and $45.5B in net profit.
Partnerships reported more gross receipts.
California partnerships filed 413,878 Forms 1065 in Tax Year 2023 and reported $435.1B in gross receipts.
| County | Returns/forms | Gross receipts | Combined income/profit metric |
|---|---|---|---|
| Los Angeles | 1,155,363 | $215.3B | $22.9B |
| Orange | 340,387 | $81.6B | $10.9B |
| San Diego | 314,274 | $52.1B | $5.8B |
| Riverside | 202,164 | $18.9B | $2.4B |
| San Bernardino | 177,417 | $16.9B | $1.9B |
| Santa Clara | 154,369 | $23.4B | $6.3B |
| Alameda | 149,735 | $22.0B | $4.4B |
| Sacramento | 133,190 | $17.5B | $2.2B |
| Contra Costa | 111,189 | $19.6B | $3.5B |
| San Francisco | 95,285 | $28.9B | $6.1B |
Business stress signals
U.S. Courts F-5A shows 3,442 business bankruptcy cases tied to California counties in the 12 months ending March 31, 2026, up from 3,348 in the prior 12-month period. Chapter 11 cases totaled 873.
The bankruptcy map is concentrated but not uniformly worse.
Los Angeles had the largest business-bankruptcy count, but its county total was nearly flat versus the prior period. Riverside, San Diego, Contra Costa, Alameda, and San Francisco showed increases in the top-ten county table.
Definition: U.S. Courts classifies debt as business when the debtor is a corporation or partnership, or when business-related debt predominates.
| County | Business cases, 12 months ending Mar. 31, 2026 | Change vs prior 12 months | Chapter 11 cases | All bankruptcy cases |
|---|---|---|---|---|
| Los Angeles | 1,080 | -2 | 343 | 15,305 |
| Orange | 402 | -14 | 103 | 3,986 |
| San Diego | 305 | +35 | 42 | 5,375 |
| Riverside | 225 | +59 | 24 | 5,459 |
| San Bernardino | 132 | +2 | 21 | 4,552 |
| Sacramento | 127 | -34 | 28 | 2,847 |
| Alameda | 115 | +11 | 36 | 1,274 |
| Santa Clara | 105 | -12 | 35 | 1,176 |
| Contra Costa | 99 | +16 | 38 | 1,316 |
| San Francisco | 83 | +11 | 33 | 483 |
National credit backdrop
The 2026 Fed Small Business Credit Survey appendix reported that 94% of U.S. employer firms faced a financial challenge in 2025, 38% applied for financing, and 52% of applicants were fully approved.
Federal contract demand
USAspending reports $60.7B in FY2025 federal procurement obligations to recipients located in California. The filter covers procurement awards to California recipients across award type codes A, B, C, and D.
| NAICS | Federal procurement category | FY2025 obligations |
|---|---|---|
| 541715 | Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology) | $9.1B |
| 541710 | Research and Development in the Physical, Engineering, and Life Sciences | $5.6B |
| 336411 | Aircraft Manufacturing | $5.0B |
| 236220 | Commercial and Institutional Building Construction | $3.6B |
| 541330 | Engineering Services | $3.5B |
| 621111 | Offices of Physicians (except Mental Health Specialists) | $2.8B |
| 334511 | Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing | $2.7B |
| 336413 | Other Aircraft Parts and Auxiliary Equipment Manufacturing | $1.8B |
| 336611 | Ship Building and Repairing | $1.8B |
| 562119 | Other Waste Collection | $1.8B |
Sources and methodology
The charts and figures on this page come from public source files or APIs. Annual sources use the most recent complete year available; partial-year figures are labeled in the text.
- Census BFS monthly CSV
Updated June 10, 2026, 14:00 GMT - Census BFS county workbook
Updated June 10, 2026, 14:22 GMT - Census county population estimates
Vintage 2025 county resident population estimates - BLS QCEW annual area files
2019 and 2024 annual API files - SBA 7(a)/504 FOIA package
Updated April 28, 2026, 14:42 GMT - IRS SOI Tax Year 2023 unincorporated tables
Tax Year 2023 - U.S. Courts F-5A bankruptcy XLSX
12 months ending March 31, 2026 - Fed SBCS Main Street Metrics appendix
Last updated March 23, 2026 - USAspending API
FY2025 procurement obligations
Alex Morgan edits public business datasets for SMB Statistics, including Census, BLS, SBA, IRS, U.S. Courts, Fed SBCS, and USAspending files.