Utah's rising business applications point to economic optimism
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New business applications rose in Utah's cities in 2022, per new Census Bureau and IRS data, Kavya Beheraj and Alex Fitzpatrick report.
Why it matters: New business applications are an important measure of an area's perceived economic health. If lots of people are trying to start new companies in a given city, it's a sign that they're bullish on the area's prospects.
- The word "startup" tends to evoke buzzy Silicon Valley tech ventures. But young companies of all stripes, from stores and restaurants to software and manufacturing firms, play a big economic role.
- As of 2021, more than 66.7 million Americans worked for companies with fewer than 100 employees, and those companies posted nearly $3.6 trillion in annual payroll, per census data.
By the numbers: With 19.1 applications per 1,000 residents in 2022, Salt Lake ranked 22nd among 108 metro areas with more than 500,000 people.
- Provo-Orem ranked 6th with 23.2, and Ogden-Clearfield came in at No. 50.
- But with a 4.4% increase in applications since 2021, Ogden-Clearfield saw the nation's sixth biggest growth.
The big picture: Just over 5 million new business applications were filed nationwide in 2022, or 15.1 for every 1,000 residents.
- That's down about 6.6% from 2021, when nearly 5.4 million applications were filed nationwide, or 16.2 for every 1,000 residents.
Zoom out: Miami/Fort Lauderdale/West Palm Beach (40.9), Atlanta/Sandy Springs/Roswell (31.3) and Orlando/Kissimmee/Sanford (28.7) took the top spots for major metro areas as ranked by new business applications per 1,000 residents in 2022.
- Zoom in: The only area outside the Southeast making the top 10: Provo/Orem, Utah, at 23.2.
Of note: Parts of the Mountain West also had strong showings — the greater Denver area came in at 21.6, for instance.
Between the lines: Many of the hottest spots for new business applications also have booming populations.
- That makes sense, as economic growth and population increases tend to go hand in hand.
Yes, but: A filed application is no guarantee of a healthy, thriving business to follow — but at the very least it's a sign of economic optimism.