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The 6th largest economy in the nation, the Keystone State would be the 19th richest country in the world after Suadi Arabia. With 13 million residents, it’s also the 5th most populated state in America.
The Pennsylvania economy rests on three major pillars, including agriculture, manufacturing, and mining. Livestock and related products make up 70% of the agriculture revenue. Manufacturing is led by chemical and pharmaceutical industries distinguished by the names of Johnson & Johnson and Pfizer.
All in all, the state is home to 50 Fortune 500 companies, with five big corporations nesting in Pittsburg. These are such worldwide known giants as U.S. Steel, PPG Industries, and H.J. Heinz.
Easy access to the big markets of New York, Washington DC, and Cleveland makes this state a welcoming spot for small enterprises (SMEs) and beginner entrepreneurs. Check our statistics overview to better understand the business climate in PA.
The state GDP reported by Statista for 2021 was $713.69 billion showing a 4.5% increase as compared to the previous pandemic year;
In 2022, the gross domestic product raised by 1.3% to $722.4 billion;
Despite a 5% GDP drop during economic stagnation caused by the COVID-19 crisis, the annualized GDP growth rate within a 5-year period is 0.8% (IBISWorld);
The industries with the highest revenues are health and medical insurance, hospitals, and colleges & universities that earned $93.2, $61.2, and $57.7 billion accordingly in 2022;
The major GDP generators in the state are manufacturing, real estate, and healthcare services sectors that ensure 37.7% of the entire state GDP;
One of the biggest US economies, the PA economic environment is maintained by small enterprises to 99.6%, with a total SME count of 1.1 million;
SMEs account for 88.2% of the state exporters and contributed $10.7 billion to a $34.2 billion PA export in 2020;
Industries with the highest SME numbers (according to Census data) are professional, scientific, and technical services and construction, with 151.593 and 121.986 entities operating in them accordingly;
Companies management is the least popular sector among SMEs, with only 713 companies currently active in it;
Around 20% of SMEs are job-givers, and the majority of them are companies with 1 to 19 employees on the payroll;
While the overall employment market in PA shows steady growth, the SME sector demonstrated a net decrease of 166.235 jobs for the year 2020-2021;
PA employment market ranks 5th nationwide providing work to 6.8 million people in the state;
SMEs maintain 46.2% of the entire labor pool, with 2.6 million workers being employed in small private companies;
431.208 state workers are engaged in SMEs transacting in a healthcare and social assistance service sector, and 315.635 people are employed in accommodation and food services;
With a $61.900 per capita disposable income as of 2022, PA ranks 12th out of 50 states;
The minimum hourly wage rate in PA matches the federal minimum of $7.25 while the higher salary margin hits the $27 mark and an average rate lingers at $20;
PA’s unemployment rate of 4.7% is 1% higher than the federal minimum of 3.7%.
Top 10 Industries for Small Businesses in PA
Professional, scientific, and technical services
Other services (excluding public administration)
Real estate, rental, and leasing
Transportation and warehousing
Healthcare and social services
Administrative, support, and waste management
Entertainment and recreational services
Accommodation and food services
PA Small Business Demographics
Females own 369.121 small enterprises across the state accounting for 39.5% of the total SME count. A bit more than 10% of those small entities employ workers;
Male-owned SMEs number 635.766 entities, and over 21% of them are work-givers;
45.508 companies are owned by women and men together, and over 50% of them have employees on their payrolls;
Ladies ensure 48.2% of the labor pool in the private sector;
Veterans possess 6.1% of small private firms across the state and represent 4.9% of the workforce;
Immigrant-owned businesses stand for 17% of SMEs in the state, and ethnic groups ensure 23.5% of the private sector employees in the state;
The SME ownership is distributed among racial minorities as follows (Census data):
Black Americans: 75.035;
American Indians and Alaska Natives: 1.300.
PA Small Business Formation
To create a Pennsylvania LLC or start a corporation, you need to get your future company formation documents approved by the state and pay a compulsory filing fee of $125;
Notably, military veterans and reservists can launch a registered business entity in the state for free subject to having an appropriate status verification at hand;