North Carolina is home to 1.1 million small businesses that make up 99.6% of all businesses in the state. Named America's #1 state for business by CNBC in 2025, the Tar Heel State keeps attracting entrepreneurs with declining tax rates and a growing workforce. Here's what the latest data shows.

How Many Small Businesses Are in North Carolina in 2026?

North Carolina's small business landscape has expanded significantly over the past decade. The SBA now counts over a million small firms across the state, from sole proprietors working out of home offices to established employers with hundreds of workers.

There are 1.1 million small businesses in North Carolina, representing 99.6% of all businesses in the state.
Small businesses employ 1,815,569 workers, accounting for 44.2% of the state's total workforce.
Of those 1.1 million firms, 914,586 (82.6%) have no employees, including sole proprietorships, single-member LLCs, and other nonemployer businesses.
The remaining 192,951 small employer firms have between 1 and 499 employees.

Small Business Count by Industry

The five industries with the largest number of small businesses in North Carolina reflect the state's diverse economy. Professional services and construction dominate, while transportation has surged in recent years.

Professional, scientific, and technical services lead with 139,289 small businesses.
Other services (except public administration) account for 133,012 firms.
Construction follows closely with 129,958 small businesses.
Administrative, support, and waste management includes 113,646 firms.
Real estate and rental and leasing rounds out the top five at 109,026 businesses.
At the other end of the spectrum, mining, quarrying, and oil and gas extraction has just 263 small businesses, though they employ 1,863 workers and account for 54.3% of the sector's total jobs.

Small Business Employment by Sector in North Carolina

When it comes to employment, the picture shifts. Some industries with fewer firms employ far more workers per business. These are the three sectors where small businesses hire the most people.

Accommodation and food services is the largest small business employer, with 276,148 employees across 16,811 small firms, representing 61.9% of the sector's total workforce.
Health care and social assistance small businesses employ 255,024 people across the state.
Construction comes in third with 191,403 workers across 26,826 small firms, covering 80.3% of total construction employment.

Why North Carolina Ranks #1 for Business

CNBC named North Carolina the top state for business in 2025 for the third time in four years (2022, 2023, 2025). The ranking evaluated all 50 states across 135 metrics, including economy, workforce, infrastructure, and business friendliness. That's not the only recognition the state has earned recently.

National Business Capital ranked North Carolina 3rd best state to start a business in 2026, citing strong GDP growth and competitive tax rates.
Small business employment in North Carolina grew by 19.1% between 1998 and 2022, outpacing the national small business employment growth rate over the same period.
Florida, Texas, and North Carolina are experiencing some of the highest small business growth rates in the nation.

North Carolina Small Business Survival Rates

One of the most common questions entrepreneurs ask is whether their business will last. North Carolina's numbers are encouraging when compared with national averages.

79.5% of new North Carolina businesses survive their first year, placing the state among top performers nationally.
After five years, 54.4% are still operating, above the national average.
Research from the North Carolina Secretary of State shows that about 25% of businesses close by year three, roughly 50.2% by year seven, and 57.9% by year ten, all better than national benchmarks.

North Carolina Tax Rates for Small Business Owners (2026)

Low taxes have been a major driver behind North Carolina's rise in business rankings. The state has been steadily cutting both corporate and individual income tax rates, with more reductions on the horizon.

North Carolina's flat corporate income tax rate is 2.0% for 2026, the lowest in the nation among states that still levy a corporate income tax. Under current law, it's scheduled to reach 0% by 2030.
The flat personal income tax rate is 3.99% starting with tax year 2026, down from 4.25% in 2025. This rate applies to pass-through small business income reported by LLC owners.
Because of its low and declining corporate tax, North Carolina consistently ranks among the most competitive states nationally for business tax climate by the Tax Foundation.
For a detailed breakdown of formation and maintenance costs, see our guide to North Carolina LLC costs and ongoing fees.

North Carolina Small Business Job Creation (2023-2024)

Between March 2023 and March 2024, small businesses drove the vast majority of net new employment in the state. These numbers come from the Bureau of Labor Statistics' Business Employment Dynamics data, reported through the SBA's 2025 North Carolina State Profile.

North Carolina added a net 58,732 jobs during this period, and small businesses contributed 52,820 of them, or 89.9% of total net job creation.
A total of 38,748 establishments opened while 30,680 closed, for a net increase of 8,068 businesses.
Small businesses accounted for 36,990 of those openings and 29,023 closings.
Opening and expanding establishments added 467,035 jobs, while closing and contracting establishments lost 408,303.

Black-Owned Business Statistics in North Carolina

North Carolina has emerged as one of the strongest states for Black entrepreneurs. A 2025 report from B2B Reviews ranked the state third in the nation for Black-owned businesses, behind only Georgia and Delaware.

Black or African American-owned businesses account for 192,580 firms in North Carolina (183,000 nonemployer and 9,580 employer firms).
About 15.95% of all small businesses in the state are Black-owned.
Black-owned businesses posted a 60.7% success rate, above the national average of 56.1%.
Between 2023 and 2024, Black-owned businesses in North Carolina grew by 17%.

Business Ownership by Demographics

Beyond race, the SBA's 2025 State Profile breaks down ownership across several demographic groups, showing broad participation in entrepreneurship across the state.

Women own 46.6% of all businesses in North Carolina, or about 451,917 firms. Of these, 412,000 operate without employees and 39,917 have employees.
Veterans own 7.3% of businesses (roughly 69,297 firms), even though veterans represent only 5.4% of the state's workforce.
Hispanic-owned firms make up 9.1% of all businesses, totaling around 95,458 companies, nearly matching Hispanics' 9.4% share of the state workforce.

Small Businesses by North Carolina City and Region

North Carolina's economic activity concentrates heavily around its major metro areas, but rural entrepreneurship also plays a significant role across the state.

Charlotte's Mecklenburg County leads with 43,247 business establishments, ahead of Wake County (Raleigh) with 40,798 and Guilford County (Greensboro) with 15,546 establishments.
In Greensboro, aviation startup JetZero announced in 2025 that it would build its first factory in the area, a project expected to create more than 14,500 jobs.
Amazon announced a $10 billion investment to build new data centers in North Carolina in 2025, on top of $12 billion the company says it has invested in the state since 2010.
Urban areas are home to 706,053 businesses, while 287,464 businesses operate in rural areas. Rural firms tend to be smaller: 87% are nonemployer businesses, compared with 81.2% in urban areas.

North Carolina Small Business Exports

Small businesses are a significant force in North Carolina's international trade. Nearly nine out of ten exporters in the state qualify as small firms.

In 2023, 10,986 firms exported goods worth $39.2 billion from North Carolina.
Of those exporters, 9,542 (86.9%) were small businesses, generating $8.8 billion in exports, or 22.5% of total identified exports from the state.

North Carolina Small Business Loans and Funding

Access to capital remains a critical factor for small business growth. Banks reporting under the Community Reinvestment Act provide significant lending to North Carolina businesses each year.

In 2023, reporting banks issued $7.8 billion in new small business loans of $1 million or less in North Carolina.
Of that total, $2.9 billion went specifically to firms with revenues of $1 million or less.
Lending through loans of $100,000 or less totaled $3.2 billion, helping smaller and newer businesses access working capital.

SBIR/STTR Grants for NC Small Businesses

North Carolina has become a national leader in federal innovation funding, with tech-oriented small businesses securing hundreds of millions in non-dilutive grants.

North Carolina small businesses secured $173 million in SBIR/STTR funding in 2023, with 129 companies winning over 200 Phase I and Phase II awards.
That total represents 3.8% of all U.S. SBIR/STTR dollars awarded that year.

How to Start a Small Business in North Carolina

If these statistics have you thinking about launching your own venture in the Tar Heel State, here's what the process looks like in terms of costs and timeline.

It costs $125 to file Articles of Organization to form an LLC in North Carolina with the Secretary of State.
The annual report fee is $200 ($203 if filed online), due by April 15th each year.
Processing typically takes 3 to 5 business days for standard filings.
North Carolina state law requires that every new LLC designates a North Carolina registered agent available during regular business hours at a physical address within the state.
North Carolina does not require a universal business license, but businesses must acquire an operating license depending on the county and the type of products or services they offer.
For a complete walkthrough, see our step-by-step guide on how to start an LLC in North Carolina.

You can verify existing business names and check entity status using the Secretary of State's database. Our North Carolina business entity search guide walks you through the process.

Need help with formation? Compare the best LLC services in North Carolina to find the right fit.

Sources

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