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Small businesses reportedly create most new jobs and are the engines of the nation’s economic growth. Statistics showing this are not always clearly presented or understood and largely depend upon how small businesses are defined.

Using a definition for small business of having less than 50 employees, 95.6 percent of San Diego businesses (with payroll) are small. These small business employers account for 38 percent of all payroll jobs in San Diego. (Technically this includes public and government entities, so it would be more accurate to call them small employers.)

The source of California’s employment data is the California state Employment Development Department, which is the corresponding state agency to the U.S. Bureau of Labor Statistics.

According to EDD, San Diego has 100,211 employers with payrolls accounting for 1.25 million jobs in the county as of 2011, the latest year currently available for these employer statistics.

This also refers only to civilian payroll jobs, and does not include another 108,000 locally based active-duty military personnel. Approximately 180,000 additional persons are reportedly employed in San Diego. They are self-employed or individual proprietorships and not counted among company payrolls. These individuals could also be considered small business efforts.

Another interesting factoid using this source and definition is while the recession impacted all business and employment sizes, small businesses have since rebounded in number, but mid-size and large businesses remain below pre-recession peaks. Very small employers (0 to 4 employees) account for all of the increase in companies since 2008.

Employment, on the other hand, is still lower among all employer sizes. Jobs among small businesses is recovering slightly better at only 4.3 percent fewer than in 2011 than in 2008, while among mid-size companies remains 6.3 percent lower and among large companies 5.2 percent fewer than.

Kelly Cunningham is an economist and senior fellow at the National University System Institute for Policy Research.


Want to spark discussion? Start a conversation by submitting a commentary at Fix San Diego.

Dagny Salas

Dagny Salas was web editor at Voice of San Diego from 2010 to 2013. She was an investigative fellow at VOSD from 2009 to 2010.

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