6 Facts You Didn’t Know About Veteran-Owned Small BusinessesVets play a bigger role in small business than you may realize.
The U.S. Census Bureau estimates there are more than 20 million veterans living in the United States. These men and women dedicated years of their lives to serving their country.
Now many of them are pouring their hard work and dedication into a different kind of endeavor: owning a business.
In some ways, running a business is a natural fit for many veterans, who understand sacrifice and have developed both leadership skills and discipline. But what do veteran-owned businesses look like, and how do they compare to civilian-owned enterprises? Here’s a peek into the world of veteran entrepreneurship and its role in the world of small business.
Nearly a tenth of all U.S. firms are veteran owned
As part of its veteran entrepreneurship program, the Small Business Administration (SBA) recently released a report titled “Veteran-Owned Businesses and Their Owners.” The latest stats indicate veterans own (or majority-own) 2.52 million businesses in the United States — an estimated 9.1 percent U.S. businesses.
Vets are more likely to be self-employed than civilians
It appears veterans are more likely to have entrepreneurial aspirations than non-vets. Data from the U.S. Bureau of Labor Statistics indicates that in 2015, the self-employment rate among veterans was 7.1 percent. For non-veterans it was 6.4 percent.
Veteran business owners are older than civilian business owners
Likely because their early careers were spent in military service, veteran business owners tend to be older than their civilian counterparts. More than 74 percent of veteran business owners are over 55, compared with 41 percent among all business owners.
Most veteran business owners start their own businesses
With the skills learned in the military, veterans are often primed for entrepreneurship in the civilian world. According to the SBA report, 85.3 percent of business-owning veterans are trailblazers, choosing to start their own small business instead of purchasing an existing company or inheriting one from a friend or family member.
Veterans are less likely to open a franchise than their civilian counterparts. Among veteran-owned employer firms, 4.2 percent operate as franchises compared with 5.3 percent of employer firms overall.
They tend to keep their businesses small, even solo
While veteran-owned businesses employ 5.03 million people nationwide, per the SBA and the U.S. Census Bureau Survey of Business Owners, the vast majority of them employ only a handful of individuals. And a whopping 82 percent of these companies are non-employer firms, meaning it’s just the owner running the show.
Of the 450,000 veteran-owned firms that do hire workers, 54.5 percent have fewer than five employees on their docket, and only 3.2 percent have more than 50.
Veterans work in a wide variety of industries
Veterans aren’t flocking to a single industry. They own businesses across all major sectors. The Census Bureau survey indicated the largest sector for veterans to enter is professional, scientific and technical services. (These services include legal advice and representation, accounting, engineering, computer services, translation, etc.) But that sector accounts for just 16.6 percent of all veteran-owned firms. Other top industry sectors for vets include real estate, retail, administrative and support services, health care and social services, transportation and finance.