Small business employment and revenue decrease in Q4-2025

Published on January 28, 2026

In Q4-2025, US small business employment decreased by 53,500 jobs (-0.41%) and average quarterly revenue at small businesses decreased by $410 (in 2017 dollars)—a quarterly decline of 0.28%. This was the second consecutive quarter of declining employment and the third consecutive quarter of declining revenue, as the charts below show.

Year-over-year, small business employment decreased by 49,100 jobs in 2025 (-0.38%) compared to 2024. Average real annual revenue at small businesses was down by $21,270 (-3.46%). Get a deeper dive into the annual trends here in the Small Business Index’s latest annual report.

Quarterly trends by sector

All 12 sectors tracked by the Index show declining employment in Q4-2025. Of these, the leisure and hospitality sector (NAICS 71-72) had the largest decrease, with 18,900 fewer jobs. The sector’s quarterly decline of 1.12% was also the fastest recorded in Q4-2025. Five of the 12 sectors, however, had average revenue growth in Q4-2025. Of these, the finance and real estate sector (NAICS 52-53) had the largest increase ($4,580) and fastest growth (3.46%). See the tables and charts below for details.

Quarterly trends by region

Similarly, all eight regions of the US show declining employment in Q4-2025. Of these, the Far West had the largest decrease, with 12,600 fewer jobs. The region's quarterly decline of 0.58% was also the fastest recorded in Q4-2025. The picture for average revenue, however, is more positive—with growth in 4 regions. Of these, New England had the most growth. See the tables and charts below for details.

Quarterly trends by state

All 20 states tracked by the Small Business Index show declining employment in Q4-2025. Of these, California had the largest decrease, with 8,700 fewer jobs (-0.57%). Washington had the fastest decline (-0.81%), with 2,400 fewer jobs. Again, the picture is more positive for average revenue—with growth in 7 states. Of these, Illinois had the most growth. See the tables and charts below for details.