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Missouri has a diverse economy, with no obvious leading earner among the industries. The strongest sectors maintaining financial stability in the state are aerospace. food processing, electrical and transportation equipment, light manufacturing, and beer production.
As per Economic Research and Information Center, the state has the 9th lowest cost of living in the country, with lower housing and energy prices. This, in turn, results in lower labor costs and allows businesses to save on operating expenses.
Besides, local governments have a few enticing programs and incentives in place to make Missouri even more attractive for small enterprises (SMEs). Check our SME statistics overview to learn more about the state's economic environment.
Though heavily hit by the COVID-19 economic crisis and having experienced a dramatic gross domestic product drop in 2020, the state demonstrated confident recovery in 2021, with a 4.6% GDP growth (Statista);
In 2022, with a $297.7 billion GDP, Missouri ranks 22nd of 50 US states showing a 0.7% growth as compared to the previous year and demonstrating 1.1% annualized growth within a 5-year period according to IBISWorld;
The private sector generates up to 90% of the state GDP, with manufacturing, real estate, and healthcare sectors ensuring the biggest shares at 12.3%, 11.4%, and 9.1% accordingly;
Industries with the highest revenues in 2022 are SUV and truck manufacturing, hospitals, health and medical insurance with earnings at $33.5, $25.7, and $25.1 billion respectively;
In 2020, private firms contributed $3.4 billion to the state exports worth $12.1 billion, and SME exporters account for 86% of the total exporter count in the state;
Small enterprises maintain 99.4% of the private business landscape in the state accounting for 542.700 entities;
Over 23% of new SME establishments fail within the first year after formation while as many as 55% survive a 5-year period. And MO is among the top 20 states with the highest SME 10-year failure rates;
The highest SME count is observed in construction and professional, scientific, and technical service sectors featuring 66.079 and 61.927 firms accordingly;
The utility sector, with 272 SMEs in it, is the least popular industry for smaller private companies;
From March 2020 to March 2021, there were 25.979 establishment openings and 19.647 closings in the SME sector. Yet, employment rates still showed a net decrease of 29.309 jobs;
MO small private companies maintain 45.3% of the employment market providing jobs to 1.2 million workers across the state;
The healthcare sector is an employment champion among SMEs having 188.797 on the payrolls. It’s followed by the accommodation and food services with 160.236 employees;
In a total SME count, only 21% of small private companies hire employees, with 1 to 10 employee entities taking a strong lead;
The minimum wage rate in Missouri is $11.15 per hour standing far above the federal minimum of $7.25;
An average wage rate is $24 per hour translating into $49.865 of average annual income;
Despite a continuing post-pandemic job decrease in the sector, the unemployment rate in the state is 3.2% falling below the state average of 3.7%.
Top 10 Industries for Small Businesses in MO
Other services (excluding public administration)
Professional, scientific, and technical services
Real estate, rental, and leasing
Administrative, support, and waste management
Healthcare and social services
Transportation and warehousing
Entertainment and recreational services
MO Small Business Demographics
Female-owned SMEs in Missouri account for 191.311 entities making 43.3% of the total SME count in the state, and 11% of them have employees (Census data);
Female employees ensure 48.4% of the total workforce in the state;
Male-possessed private companies number 294.319, and nearly 20% are employer businesses;
33.237 firms are equally owned by two gender groups, and 70% of them use hired workforce;
Military veterans control over 8% of SMEs in MO and make up 5.4% of workers across the state;
Racial minorities possess 13.2% of small private companies in Missouri and represent 19% of the labor pool;
The three biggest SME owner ethnic groups are:
Black or African Americans: 39.106;
MO Small Business Formation
Starting an LLC in Missouri is about registering the LLC statute with the state and paying a $50 state fee for online filing and a $105 for filing in paper format;
Incorporation fees in the state are graduated and start at $58 for up to $30.000 of the authorized capital. Each next $10.000 of capital entails $5 in fees;
To maintain an LLC or corporation, the state law calls for legal entities to have a registered agent in Missouri that will have a street address in the jurisdiction and be consistently present at that address during business hours;
To stay compliant, LLCs and corporations are to file annual reports to the state office that entail a $21.25 fee when filing online and a $45 fee when filing by mail;
Missouri has a progressive multi-tier system of personal tax rates. The more you earn the higher the levy will be;
Tax brackets are strictly ranged from $0 to $274 plus a percentage (from 1.5% to 5.4%) levied over any amount in excess of the stipulated income amount for the bracket;
Meanwhile, a corporate income tax is charged at a flat 6.25% rate;
The state sales tax rate in MO is 4.225%. Yet, with local taxes of up to 5.375%, the average rate hits a much higher mark of 7.943%.