The number of small businesses in the state expanded rapidly in the post-pandemic period, a new
Wisconsin Policy Forum report finds. The number of establishments in the state with fewer than 500
employees surged 20.2% between 2020 and 2025, far outpacing their growth in the prior decade.
While this increase may signal an entrepreneurial upswing, growth has not been consistent across
business sizes, industries or geographies. The number of micro-businesses with fewer than 10 employees has grown rapidly, but the number of establishments with 100 or more employees has
increased much more slowly.
Wage and payroll growth among Wisconsin small businesses has been strong, particularly in the 2021 to 2023 period of high inflation. This dynamic suggests that the labor market has tightened and
become more expensive for small business owners, which may have pressured their margins.
The retail trade sector has long had the largest number of small business establishments in Wisconsin. While this remained the case as of 2024, retail and wholesale trade have seen the largest declines in total establishments, likely a consequence of the ongoing shift to e-commerce.
In recent years, there has been particularly strong growth in the number of health care and social
assistance small businesses. This sector also has contributed heavily in terms of job creation. From
2010 to 2024, small health care establishments added 38,640 jobs, accounting for roughly two-thirds
of net small business job growth across all sectors.
Meanwhile, the share of Wisconsin small business employees working in manufacturing was 1.78 times higher than the national share in 2024. Our state’s continuing reliance on the manufacturing industry produces exports and jobs with relatively high average wages, but it also creates exposure to sector specific turbulence. Several smaller metro areas in Wisconsin remain heavily reliant on manufacturing, which represents both a strength and a potential risk.