Small Businesses Have Big Impact

Small Businesses Are Big Business in Thief River Falls

Small businesses are often described as the “backbone” of the economy. That phrase is familiar because it is true—but it can also undersell the real impact small businesses have on jobs, wages, community life, and long-term economic resilience.

Across the country, small businesses represent 99.9 percent of all businesses. They employ 62.3 million people, or 45.9 percent of private-sector workers, and generate 43.5 percent of the nation’s gross domestic product. They also pay 38.7 percent of total private-sector payroll. (Office of Advocacy)

Those national numbers are impressive, but the impact of small business is even easier to see at the community level. In Pennington County, the U.S. Census Bureau reports 365 employer establishments, 8,929 jobs, and $538.1 million in annual payroll (2023). Those totals include businesses of all sizes, including the area’s larger employers, but they still demonstrate the scale of private-sector business activity that supports the local economy.

The county also had 814 nonemployer establishments—businesses with no paid employees, often representing sole proprietors, independent contractors, and entrepreneurs building a business around their own skills and services. Together, these figures point to a broad base of business ownership and entrepreneurial activity that helps sustain the local economy.

For Thief River Falls and Pennington County, this local business base is more than a set of statistics. These businesses include contractors, restaurants, retailers, professional service providers, child care providers, health and wellness businesses, repair shops, makers, consultants, and entrepreneurs testing new ideas. They create jobs, circulate dollars locally, support community events, and help make the area a place where people live, work, and grow.

Minnesota’s small business picture reinforces that story. According to the U.S. Small Business Administration’s 2025 Minnesota Small Business Profile, the state is home to 560,428 small businesses, representing 99.5 percent of all Minnesota businesses. These businesses employ 1.3 million people, or 45.8 percent of Minnesota employees. (Office of Advocacy)

A recent analysis from the Minnesota Department of Employment and Economic Development also highlights the importance of very small businesses—those with fewer than 20 employees. In early 2025, these businesses made up 88.9 percent of all Minnesota establishments and generated $9.58 billion in quarterly wages. DEED also noted that Greater Minnesota depends more heavily on small businesses than the metro area, with rural regions showing 23 to 30 percent of total employment in small businesses compared to 15 percent in the metro. (mn.gov // Minnesota’s State Portal)

That matters for communities like Thief River Falls. Rural economies are often shaped by a combination of major employers, public institutions, agriculture, manufacturing, health care, retail, construction, and locally owned service businesses. Large employers are important, but small businesses fill critical gaps. They provide specialized services, create entry points for entrepreneurship, diversify the local economy, and add vitality to commercial districts and neighborhoods.

Small businesses also play an outsized role in job creation. Nationally, recent SBA data shows that from March 2023 to March 2024, small businesses created approximately 9 out of every 10 net new jobs. During that period, small businesses opened 1.1 million new establishments and produced a net increase of 1.2 million jobs. (Office of Advocacy)

At the same time, small business owners are navigating a challenging environment. The U.S. Chamber of Commerce’s Small Business Index reported that inflation remained the top challenge for small businesses in late 2025, with 45 percent identifying it as their biggest issue. The same report found growing concerns about attracting and retaining employees, while 43 percent of small businesses said their local economy was in good health. (U.S. Chamber of Commerce)

Minnesota businesses are feeling many of the same pressures. The Minnesota Chamber’s 2025 business retention and expansion report found that small businesses face rising costs, workforce shortages, access-to-capital challenges, and increasing regulatory and administrative burdens. The report also emphasized that helping small firms survive, grow, and scale is critical to sustaining job creation and strengthening Minnesota’s economy. (Minnesota Chamber of Commerce)

This is why local economic development work matters. When a small business receives help with planning, financing, marketing, workforce, succession, expansion, or problem-solving, the benefit does not stop with that one business. It can mean a retained job, a new storefront, a stronger tax base, a new service for residents, or a business owner who has the confidence to take the next step.

For Advance Thief River, supporting small business is not separate from community development—it is community development. A healthy small business environment helps retain residents, attract new families, support major employers, strengthen the downtown and commercial corridors, and create opportunities for people who want to build something of their own.

The data confirms what people in Thief River Falls already know: small businesses are not small in impact. They are essential infrastructure for a strong local economy.

Sources

U.S. Small Business Administration Office of Advocacy, Frequently Asked Questions About Small Business 2026 (Office of Advocacy)
U.S. Small Business Administration Office of Advocacy, 2025 Small Business Profile: Minnesota (Office of Advocacy)
U.S. Census Bureau QuickFacts, Pennington County, Minnesota (Census.gov)
Minnesota Department of Employment and Economic Development, “Small Shops Shaping Minnesota” (mn.gov // Minnesota’s State Portal)
U.S. Chamber of Commerce / MetLife, Small Business Index Q4 2025 (U.S. Chamber of Commerce)
Minnesota Chamber of Commerce, 2025 State of Business Retention and Expansion in Minnesota (Minnesota Chamber of Commerce)