US: Only 35% of companies founded a decade ago have survived

A record number of Americans have become entrepreneurs during the pandemic, with the demand for new businesses reaching huge proportions, according to a visualcapitalist.com analysis based on figures from the Bureau of Labor Statistics (BLS) published in 2024.

But running a business is difficult, and the evolution of the number of companies in the US from 2013 to 2023 highlights this.

Not surprisingly, the survival rates of new American businesses depend on the industry in which they operate, according to the cited source. The data shows that businesses in agriculture and forestry born in 2013 have been the most resilient over the past decade. More than half, or 51 percent, were still in business in 2023. In stark contrast, only a quarter of mining, oil, and gas companies survived over the same period.

Both industries are among the biggest recipients of government subsidies. Federal support for U.S. agriculture is estimated to be $30 billion annually, largely covering five major crops: corn, soybeans, wheat, cotton, and rice.

Meanwhile, the U.S. energy sector receives about $20 billion a year, 80 percent of which goes to oil and gas.

Differences in ownership structure and business size may account for the vastly different survival rates, the source notes. For example, 97 percent of all farms in the U.S. are still family-owned, and 88 percent of them are "small farms," which may require less capital investment than an oil and gas business.

A trend that is independent of the industry in which a company operates is that the first year of existence proved to be the hardest for all businesses created in 2013, with a 20 percentage point decline in surviving firms. As time went on, the declines continued at a slower pace.

Finally, the BLS found that of all private businesses registered in the US in 2013, just over a third (34.7%) were still operating in 2023. While 51% of businesses in agriculture and forestry were still operating in 2023, the proportion in utilities was 46%, in manufacturing 44%, in real estate and retail 42%, in construction 40%, in education 39%, in hospitality and finance 38%, in health care 36%, in entertainment 35%, in transportation 34%, in legal and accounting 31%, in technology 29%, and in mining, oil and gas 25%.