West Virginia’s economy has two anchors, and they are now almost level. Measured by output, mining, oil and gas still produce more than health care, but only by $177 million in 2025, down from a $7.5 billion lead three years earlier. Measured by jobs, health care is far in front: 136,740 private jobs, against 19,736 in mining, oil and gas.
Small businesses sit between the two. The state counts 118,045 of them, 98.8% of its firms, and in 2022, the latest year the SBA’s September 2026 profile covers, they employed 256,281 people, 47.4% of the state’s employees, slightly more than the national 45.9%. What they have done since, where the state is gaining and losing, and how its taxes have changed follow below.
Mining, Oil and Gas Still Lead GDP, by $177 Million
| Year | Mining, oil and gas | Health care and social assistance | Gap |
|---|---|---|---|
| 2022 | $17.30 billion | $9.77 billion | $7.52 billion |
| 2023 | $13.89 billion | $10.91 billion | $2.97 billion |
| 2024 | $14.24 billion | $12.05 billion | $2.20 billion |
| 2025 | $13.12 billion | $12.94 billion | $0.18 billion |
The mining line mixes two different businesses. In 2024, the last year BEA splits it, coal, metal and stone mining produced $8.78 billion and oil and gas extraction $4.42 billion, down from $7.96 billion in 2022 as gas prices fell. Coal alone is already smaller than health care in output.
Coal remains a large employer by national standards. Private coal mines in West Virginia employed 12,920 people in 2025, more than any other state and 33.0% of all private coal-mining jobs in the country, even though that number fell by 710, or 5.2%, during the year. Mining, oil and gas was also the only major sector whose average pay went down, by 2.4% to $108,014.
The shift showed up in growth. Real GDP rose just 0.5% in 2025, second-slowest among the states and tied with Wyoming. Mining, oil and gas took 0.43 percentage points off that growth, while health care added 0.54.
Take Out the Hospitals and 2025’s Private Jobs Fell
Private employers added 1,075 jobs in 2025, a gain of 0.2%, according to BLS payroll data for West Virginia. Private hospitals alone added 3,551, growing 7.3% to 51,895 jobs. Without them, private employment would have fallen by about 2,476. Health care and social assistance as a whole gained 2,548 jobs, while every other sector put together lost 1,473.
No state leans on hospital work to the same degree. The share of West Virginia jobs in private hospitals is 2.09 times the national share, the highest concentration among the 50 states and the District of Columbia, and health care accounts for 11.8% of state GDP, also the highest share anywhere. Monongalia County, around Morgantown, has the largest hospital workforce of any county, 12,567 jobs averaging $93,432. Home health care, a smaller field, grew fastest, up 12.1% to 6,822 jobs.
Small Firms Hold Nearly Half the Jobs, and Made a Quarter of the Growth
Two measures, taken in different ways and over different periods, describe small businesses here. The first is their weight: 47.4% of employees worked for a firm with fewer than 500 people in 2022. The second is their recent contribution: from March 2024 to March 2025, establishments of small firms added 958 net jobs out of a statewide net gain of 4,052, or 23.6%. A year earlier, in the same series, they had produced 61.0% of a 9,648-job gain. Net new establishments shrank over the same two periods, from 1,943 to 275.
Their weight varies by industry. Small firms hold 92.8% of jobs in the services catch-all that runs from repair shops to salons, and 88.2% in construction, but only 38.6% in health care and 28.6% in mining, oil and gas, a share only utilities fall below. The signature industries of the state are mostly run by large employers.
- Nearly four in five small businesses, 93,669 of 118,045, have no employees.
- The 2023 nonemployer count reached 94,681, of which 88.7% were run as individual proprietorships.
- Payroll per employee averaged about $42,000 at small firms in 2022, against roughly $55,400 at larger ones.
Where the State Is Gaining, and Where It Is Not
Thirty-one of West Virginia’s 55 counties ended 2025 with fewer private jobs than they started with. Among the 13 counties with at least 10,000 private jobs, Putnam, between Charleston and Huntington, grew fastest, adding 1,134 jobs (6.0%), and paid the most, $69,212 on average. Kanawha County, home to Charleston, lost the most, 1,771 jobs (2.3%), and Greenbrier fell 4.9%.
Population since 2020 draws a different line. Only 8 counties have grown, led by Berkeley (14.3%) and Jefferson (9.4%) in the Eastern Panhandle, within commuting range of the Washington area. The steepest declines are in the southern coal counties: McDowell (11.7%), Mingo (9.0%) and Wyoming (7.4%).
The Fewest Business Filings per Resident of Any State
West Virginians filed 16,387 applications for new businesses in 2025, a record for a Census series that starts in 2005. Relative to population, that is still 9.28 applications per 1,000 residents, the lowest rate among the 50 states and the District of Columbia, where the national rate is 16.59. Applications flagged as likely to become employers are also the lowest per resident, 2.86 per 1,000.
The pace is picking up: 13,699 applications in the first eight months of 2026, up 20.4% on the same stretch of 2025, compared with a 13.5% rise nationally. SBA-guaranteed borrowing is just as sparse per head: 12.0 7(a) loans per 100,000 residents in fiscal 2025, a rate only Mississippi fell below.
Behind the low filing rate is a population that is aging in place. More people moved into West Virginia from other states in 2025 than left, a net gain of 6,408, but deaths outnumbered births by 7,887, the steepest natural decrease relative to population among the 50 states and the District of Columbia, so the state still lost 1,255 residents.
Income Tax Rates Down About 30% Since 2022
West Virginia has cut its personal income tax three times since 2022. The latest cut, Senate Bill 392, was signed on March 31, 2026 and lowered every rate by 5%, retroactive to January 1, 2026. Because most LLCs pass their income through to their owners, these are the rates most small-business owners pay.
| Taxable income | 2022 rate | 2026 rate |
|---|---|---|
| Up to $10,000 | 3.00% | 2.11% |
| $10,000 to $25,000 | 4.00% | 2.81% |
| $25,000 to $40,000 | 4.50% | 3.16% |
| $40,000 to $60,000 | 6.00% | 4.22% |
| Over $60,000 | 6.50% | 4.58% |
On $60,000 of taxable income, the tax falls from $2,775.00 under the 2022 schedule to $1,950.50 in 2026. Other costs have held steady:
- Forming an LLC: $100 for the articles of organization, plus a $1 processing fee online through the state’s One Stop Business Portal, which replaced Business4WV.
- Annual report: $25 if filed between January 1 and June 30 of each year after formation, $75 after June 30.
- Fee waivers: founders aged 18 to 29 who live in the state skip the initial registration fee; businesses at least 51% owned by veterans, service members or their spouses also skip annual report fees for four years.
- Corporate income tax: 6.5% for 2025; no change found for 2026.
- Sales tax: 6%, plus 1% in a growing list of municipalities.
- Small-business property tax credit: a refundable income tax credit worth 50% of personal property tax paid, for businesses with $1 million or less in appraised personal property (oil and gas working interests excluded).
- Minimum wage: $8.75 an hour, unchanged since 2016, for employers with six or more workers at one location; $2.62 in cash for tipped staff.
For the filing itself, see how to start a West Virginia LLC. A West Virginia operating agreement template covers the rules between co-owners.
West Virginia in Three Questions
Is West Virginia still a coal economy?
Less than it was. Mining, oil and gas together still produced slightly more GDP than health care in 2025, by $177 million, but coal on its own is smaller than health care, and hospitals employ far more people than the mines. The state does employ more coal miners than any other, 12,920 in private coal mining, a third of the national total.
Are there fee waivers for new West Virginia businesses?
Two. Founders aged 18 to 29 who live in West Virginia skip the initial registration fee. Businesses at least 51% owned by veterans, active service members or their spouses skip that fee and the annual report fee, normally $25, for their first four years.
How much did West Virginia’s income tax fall between 2022 and 2026?
Each rate is about 30% lower. The top rate went from 6.5% to 4.58% and the bottom rate from 3% to 2.11%. On $60,000 of taxable income, the tax dropped from $2,775.00 to $1,950.50.
Sources
- Small-business counts, employment shares and job-creation figures: the SBA’s 2026 West Virginia profile, with its 2025 edition for the previous year.
- County and industry payrolls for 2025: BLS QCEW annual averages, plus the national files used for state-to-state comparisons.
- Output by industry and each industry’s pull on real growth: BEA regional accounts, April 2026 release.
- Population, migration and births and deaths (Vintage 2025), nonemployers (2023) and monthly business applications through August 2026: Census Bureau.
- SBA 7(a) loan approvals for fiscal 2025, from the agency’s public loan data.
- Tax schedules, SB 392, sales tax and the property tax credit from the West Virginia Tax Division; fees, annual reports and waivers from the Secretary of State; the minimum wage from the Division of Labor.
