Colorado Small Business Statistics
Written by Dmytro Kondratiev
Editor, lawyer
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Colorado ranks 4th in the CNBC “Top States for Business” rating published in 2022. And this alone speaks a lot about the state's economic strength and business environment, especially taking into account the fact that in 2021, the Centennial State was in the 8th position.
Colorado is the 6th in the Wallet Hub ranking of top US economies estimated by economic activity and health and potential for innovation. The state also boasts one of the best startup environments in the nation hosting the biggest free annual startup event.
Maintaining a pro-business approach and healthy work-to-life balance, the state is a welcoming spot for multiple business relocations and new small enterprise (SME) formations. If it looks attractive to you too, our small business stats won’t go amiss.
Key Colorado Small Business Stats
- Under the IBISWorld survey, Colorado's GDP amounts to $371.3 billion in 2022 showing a 2.4% growth as compared to the previous year;
- The state GDP ranks 15th in the nation and 8th by a 5-year growth rate of 1.5%;
- The most prominent industries in the state greatly contributing to its GDP and generating the highest revenue are oil drilling and gas extraction, tourism, and car dealers with $37.4 billion, $26.9 billion, and $21.5 billion revenue accordingly;
- According to a 2021 SBA report, there are 674.741 SMEs in Colorado representing 99.5% of all businesses in the state;
- Nearly 77% of SME owners made a well-thought decision to launch a venture;
- Within the recent 5 years, the number of SMEs in CO has been consistently growing by 3% on average;
- The most popular SME sector is professional, scientific, and technical services, with over 118.000 smaller private ventures operating in it;
- Meanwhile, company management is the least attractive sector for SMEs, with only 380 companies engaged;
- The biggest CO GDP contributor is the real estate and rental sector pumping up to $51 billion in GDP;
- International trade is the state economy’s backbone, with $7.9 billion brought by the export of grains, beef, electronics, and chemicals. And SMEs makeup up $2.1 billion of the total exported goods worth;
- SMEs employ 1.2 million workers ensuring 48% of all employment in the state;
- While most private entities are non-employers, nearly 28% of SMEs are firms with 1 to 19 workers;
- The highest private workforce concentration is in the accommodation and food sector and health care and social services, with 182.563 and 157.407 employees accordingly;
- In 2019, SMEs ensured 33.618 net jobs, and 27.593 of them were in private firms with fewer than 20 workers;
- A disposable personal income in CO in 2022 is $58.900 which is slightly higher than the US average;
- The SME salary in the state falls anywhere between $36168 and $69518, with an average hitting a $52712 mark;
- The minimum hourly wage in the state is $12.56, with an average of $25;
- The state unemployment rate is 3.5% showing a slight tendency to increase within a 5-yeard period.
Top 10 Industries for Small Businesses in CO
| Industry | Company Count |
|---|---|
| Professional, scientific, and technical services | 118.119 |
| Real estate, rental, and leasing | 78.094 |
| Construction | 77.404 |
| Other services (excluding public administration) | 61.927 |
| Retail trade | 51.732 |
| Healthcare and social services | 49.492 |
| Transportation and warehousing | 48.287 |
| Administrative, support, and waste management | 47.861 |
| Entertainment and recreation | 35.890 |
| Financial services | 21.240 |
CO Small Business Demographics
- Based on the US Census data, women-owned companies make up 44.5% of the total SME count in the state, and 87% of them are non-employers;
- Men control 353.111 SMEs, and 20% of them are employer businesses;
- 38.460 companies have ownership equally split between female and male owners;
- Speaking of manpower, women account for 46% of workers in the state;
- Veterans possess 7.4% of private ventures and represent 6.3% of the workforce;
- Hispanics are the largest immigrant group maintaining 11% of SMEs and a 19.8% workforce share;
- Business.org reports that other racial minorities are 7.4% of companies and 12.1% of workers in the state private sector.
CO Small Business Formation
- 36% of businesses in the state are five-year-old and younger;
- Offering greater business potential and opportunities, registered companies take a lead among SMEs in CO;
- To form an LLC in Colorado, you just need to get your Articles of Organization approved by the state and pay a $50 state filing fee (now only $1 under the CO Business Fee Relief Act);
- With a Colorado registered agent on your side, you’ll stay compliant and by filing a periodic report (at $10) annually, you’ll maintain your entity’s legitimacy;
- An individual income tax rate valid for pass-through LLC owners is 4.55%;
- A corporate tax rate applicable to LLCs taxed as C-Corps is 4.55% as well. It’s one of the highest corporate rates across the country;
- A current state sales tax rate is 2.9%. Notably, local taxes can further bump it as high as 11.2% in some municipalities.