How Many Small Businesses Are in Arizona in 2026?

Arizona is home to 706,640 small businesses in 2026, which make up 99.5% of all firms in the state and employ 1.2 million people. Arizona’s small business sector is growing fast, and the numbers below cover its size, industries, owners, and the cost of starting up.

How Big Is Arizona’s Small Business Sector?

Small businesses account for 99.5% of Arizona employers and more than 40% of private-sector jobs, per the latest SBA state profile for Arizona.

Arizona has 706,640 small businesses, which is 99.5% of all businesses in the state.
Small businesses employ 1.2 million people in Arizona, about 42.6% of the state’s workforce.
The state is home to 585,251 nonemployer businesses, solo ventures with no paid staff, which together took in $33.4 billion in receipts.
The small business count grew from 678,357 in the 2024 profile to 706,640, a year-over-year gain.

Arizona Pay and Job Growth

Arizona employers added jobs at a 1.8% clip in 2024, and pay spreads widely, from utilities near $127,000 a year to about $31,000 in hospitality.

The state’s 2.8 million private-sector workers earned an average of $70,192 in 2024.
The highest-paying sectors are utilities ($126,962) and manufacturing ($98,851).
The lowest-paying major sector is accommodation and food services, at $31,316 a year.
Private employment grew 1.8% between 2023 and 2024, adding about 49,000 jobs.

Arizona’s Leading Industries

Arizona’s 222,682 private establishments employ roughly 2.8 million people. Health care is the top employer, followed by retail and a busy construction sector.

Health care and social assistance is the largest employer, with 462,596 jobs across 22,724 establishments.
Retail trade supports 345,178 jobs across 17,270 establishments.
Accommodation and food services employs 310,498 workers across 13,944 establishments.
Administrative and support services account for 245,123 jobs across 14,713 establishments.
Construction supports 226,684 jobs across 18,417 establishments, and manufacturing adds 193,962 jobs.

Arizona’s Top Job-Growth Sectors

A handful of Arizona sectors posted outsized job gains from 2023 to 2024.

Arts, entertainment and recreation grew employment 13.7%, the fastest of any sector.
Mining rose 7.2%, construction 6.4%, and health care 5.3%.

Arizona’s Business Hotspots: Phoenix, Tucson and Pinal

Metro Phoenix, in Maricopa County, holds most of Arizona’s businesses. Those county tallies span employers of all sizes, from solo shops to major corporations.

Maricopa County (Phoenix) anchors the state with 141,918 establishments and 2,063,202 jobs.
Pima County (Tucson) has 23,348 establishments and 313,855 jobs.
Pinal County hosts 4,907 establishments and 56,578 jobs.

Arizona’s Rising New Business Filings

New business filings in Arizona hit their highest mark in six years in 2025, far above where they stood in 2020.

Arizonans filed about 135,000 new business applications in 2025, up from roughly 90,000 in 2020.
Applications have risen by roughly half since 2020, reaching their highest point in 2025.

How Arizona Firms Borrow and Export

Beyond the local market, Arizona’s small businesses draw on SBA loans and export demand.

SBA Loans in Arizona

Arizona borrowers drew roughly $913 million in SBA-backed loans in fiscal year 2024, from SBA loan approval data.

SBA 7(a) loans totaled 1,335 loans for $705.0 million.
SBA 504 loans added 199 loans for $208.1 million, and the Microloan program provided 24 loans for $0.7 million.

What Arizona Ships Abroad

Small businesses are 85.9% of Arizona’s exporters, though they generate a bit over a quarter of the export dollars.

6,426 small firms exported from Arizona in 2023, 85.9% of all identified exporters.
Small businesses made up 27.3% of the state’s identified-firm exports, which totaled $25.9 billion.

Arizona’s Business Owners

Arizona’s owners are a diverse group, and Hispanic entrepreneurs run a large share of the state’s firms. It counted 116,651 employer firms as of 2022.

Women own 46.2% of Arizona businesses, and Hispanic entrepreneurs own 23.0%.
Among employer firms, Hispanic-owned businesses number 11,872, followed by Asian-owned (7,678) and Black-owned (2,062).
American Indian and Alaska Native-owned employer firms total 1,342.
Veterans own 6.5% of all Arizona businesses. Among employer firms, veteran-owned firms total 5,876 and minority-owned firms total 22,370.

Arizona’s Growing Economy and Tourism

Arizona’s economy keeps expanding, widening the customer pool for local businesses.

Arizona’s GDP reached $598.2 billion in 2025 in current dollars, up from $570.1 billion in 2024.
Adjusted for inflation, real GDP was $455.7 billion.
Nonemployer businesses alone generated $33.4 billion in receipts in 2022.

Arizona Tourism Dollars

Tourism pours money into Arizona’s resorts, restaurants, and shops every year, as measured by the Arizona Office of Tourism.

Travelers spent $29.7 billion in Arizona in 2024.
The state drew 20.8 million overnight visitors, and tourism supported 193,800 direct jobs.
Travel activity generated more than $4.3 billion in tax revenue.

Arizona Formation Fees and Tax Rates in 2026

Arizona keeps startup paperwork light, with no annual report required of LLCs. Our step-by-step guide to starting an LLC in Arizona runs through the process.

Starting an Arizona LLC or Corporation

Business filing fees in Arizona come from the Arizona Corporation Commission.

Filing Articles of Organization for an Arizona LLC costs $50.
Arizona LLCs have no annual report requirement, so there is no recurring state filing fee.
Filing Articles of Incorporation for a corporation costs $60. Every entity must appoint an Arizona statutory agent. To compare providers, see the best Arizona LLC services.

Arizona’s Flat Tax and Minimum Wage

Arizona levies a flat personal income tax and, in place of a standard sales tax, a transaction privilege tax.

Arizona’s individual income tax is a flat 2.5%.
The state transaction privilege (sales) tax rate is 5.6%, before local add-ons.
Arizona’s minimum wage rose to $15.15 per hour on January 1, 2026.

What Arizona Entrepreneurs Want to Know

New Arizona founders ask these questions most, answered from current government data.