How many small businesses survive their first year, five years or ten years?
You’ve probably seen some version of this claim:
“Half of small businesses fail within five years.”
It sounds precise.
The underlying government data tell a more nuanced story.
U.S. Bureau of Labor Statistics data track the survival of private-sector business establishments with employees over time. Those data show that survival declines most sharply during the early years, but the exact survival rate varies by birth cohort, industry and economic conditions.
For example, BLS reported that 57.3% of establishments born in 2018 survived five years.
For private-sector establishments born in March 2013, 50.6% were still operating five years later and 34.7% were still operating ten years later.
Those are useful benchmarks.
But they do not mean that exactly 42.7% of all small businesses “fail” within five years or that 65.3% fail within ten years.
The statistics measure establishment survival under a specific government methodology.
This guide explains what the data actually measure, how survival changes over time, how industries differ and how entrepreneurs can use survival statistics without turning historical averages into predictions about an individual business.
Last reviewed: September 2026
Methodology note: Unless otherwise stated, survival figures in this guide come from the U.S. Bureau of Labor Statistics Business Employment Dynamics program and refer to private-sector employer establishments. They do not represent every small business, sole proprietor, freelancer or nonemployer business. StartupWerx does not automatically convert establishment non-survival into “business failure.”
Small Business Survival Rates at a Glance
The March 2013 BLS cohort provides a clean ten-year view of establishment survival.
| Age | Survival Rate | Share No Longer Surviving in Original Cohort |
|---|---|---|
| Start | 100.0% | 0.0% |
| 1 year | 79.6% | 20.4% |
| 2 years | 68.9% | 31.1% |
| 3 years | 61.4% | 38.6% |
| 4 years | 55.3% | 44.7% |
| 5 years | 50.6% | 49.4% |
| 6 years | 46.7% | 53.3% |
| 7 years | 42.8% | 57.2% |
| 8 years | 39.9% | 60.1% |
| 9 years | 37.6% | 62.4% |
| 10 years | 34.7% | 65.3% |
The third column is simply the mathematical complement of the BLS survival rate.
It should not automatically be labeled a failure rate.
For example:
100% − 50.6% = 49.4%
That tells us what share of the original 2013 establishment cohort was no longer surviving after five years.
It does not tell us that 49.4% experienced financial failure.
Do 50% of Small Businesses Fail Within Five Years?
That statement is too broad.
BLS has tracked multiple cohorts of new establishments, and five-year survival has varied.
Selected BLS five-year survival rates include:
| Birth Cohort | 5-Year Survival Rate |
|---|---|
| 1994 | 54.3% |
| 2001 | 52.3% |
| 2003 | 55.3% |
| 2006 | 49.8% |
| 2010 | 56.0% |
| 2018 | 57.3% |
Of these selected BLS cohorts, only the 2006 cohort fell below 50% at five years.
The range was:
49.8% to 57.3%
A more defensible summary is therefore:
Historically, roughly half or somewhat more of the new employer establishments in these selected BLS cohorts survived at least five years.
That is considerably more precise than:
“Half of all small businesses fail within five years.”
Why “Survival Rate” Is Better Than “Failure Rate”
BLS reports survival.
That terminology matters.
The data establish whether establishments in an original birth cohort remain operating as surviving establishments over time.
They do not provide a universal diagnosis of why every establishment that leaves the surviving cohort did so.
A business can stop operating for many reasons.
Some closures may involve:
- Financial losses
- Insufficient demand
- Cash-flow problems
- Competitive pressure
- Owner decisions
- Retirement
- Strategic changes
- Other circumstances
But the survival percentage itself does not assign a cause to each exit.
For that reason, StartupWerx uses:
survival rate
when discussing the BLS survival series.
We do not automatically transform:
65.3% no longer surviving after ten years
into:
65.3% failed.
What Is an Establishment?
This is one of the most important distinctions in business statistics.
An establishment generally represents an individual location where business activity occurs.
A firm can consist of one or more establishments under common ownership or control.
Consider a company operating five stores.
Those stores can represent multiple establishments while belonging to one firm.
If an establishment disappears from a dataset, that is not necessarily equivalent to saying the entire multi-establishment firm ceased to exist.
The Census Bureau’s Business Dynamics Statistics therefore distinguish measures such as:
- Establishment births
- Establishment deaths
- Firm startups
- Firm shutdowns
- Job creation
- Job destruction
This is another reason to be cautious when converting establishment statistics into claims about “business failure.”
The First Year Shows the Largest Survival Decline
For the March 2013 BLS cohort, the largest decline occurred during the first year.
Survival moved from:
100.0% → 79.6%
That is a decline of:
20.4 percentage points
BLS reported that this first-year pattern held across the major industry groups in its 2013 analysis.
Survival continued declining afterward, but generally less steeply as time passed.
StartupWerx Business Survival Curve
Instead of treating five years as a pass/fail deadline, think of survival as a curve.
Launch
100.0% of the cohort
Every establishment is present at the starting point.
Year 1
79.6% surviving
The 2013 cohort experienced its largest overall decline during this first year.
Year 2
68.9% surviving
More than two-thirds of the original establishments remained.
Year 3
61.4% surviving
A majority of the original cohort continued operating.
Year 5
50.6% surviving
Approximately half of the original cohort remained.
Year 7
42.8% surviving
Exit continued after the commonly cited five-year mark.
Year 10
34.7% surviving
About one-third of the original establishments remained in operation.
This curve is much more informative than reducing entrepreneurship to:
“Half fail.”
Five-Year Survival Changes by Birth Cohort
There is no single permanent five-year survival rate.
BLS’s selected historical comparison shows:
| Cohort | 5-Year Survival |
|---|---|
| 1994 | 54.3% |
| 2001 | 52.3% |
| 2003 | 55.3% |
| 2006 | 49.8% |
| 2010 | 56.0% |
| 2018 | 57.3% |
The difference between the lowest and highest selected rates is:
7.5 percentage points
BLS notes that survival varies across the business cycle.
Startups encountering recessionary periods during their early development have historically experienced different survival outcomes from businesses born during other economic conditions.
The 2018 cohort, for example, encountered the pandemic recession yet recorded the highest five-year survival rate among the selected cohorts in the BLS comparison.
That is another warning against turning one historical percentage into a universal rule.
What Is the 10-Year Business Survival Rate?
For U.S. private-sector business establishments born in March 2013:
34.7% were still operating in March 2023.
The survival path was:
| Age | Survival Rate |
|---|---|
| 1 year | 79.6% |
| 2 years | 68.9% |
| 3 years | 61.4% |
| 4 years | 55.3% |
| 5 years | 50.6% |
| 6 years | 46.7% |
| 7 years | 42.8% |
| 8 years | 39.9% |
| 9 years | 37.6% |
| 10 years | 34.7% |
This is a particularly useful benchmark because it follows the same March 2013 cohort over a full decade.
It should still be described as an establishment-survival statistic—not a universal ten-year failure rate for all U.S. small businesses.
10-Year Business Survival Rates by Industry
Industry makes a substantial difference.
BLS reported the following survival rates for private-sector establishments born in March 2013 and still operating in March 2023:
| Industry | 10-Year Survival Rate |
|---|---|
| Agriculture, forestry, fishing & hunting | 50.5% |
| Utilities | 45.7% |
| Manufacturing | 43.6% |
| Real estate, rental & leasing | 42.2% |
| Retail trade | 41.7% |
| Construction | 40.1% |
| Other services, except public administration | 39.6% |
| Educational services | 38.9% |
| Accommodation & food services | 38.2% |
| Finance & insurance | 37.5% |
| Health care & social assistance | 35.7% |
| Arts, entertainment & recreation | 35.4% |
| Total private sector | 34.7% |
| Administrative & waste services | 34.2% |
| Transportation & warehousing | 34.0% |
| Management of companies & enterprises | 33.0% |
| Professional, scientific & technical services | 30.9% |
| Wholesale trade | 30.1% |
| Information | 29.1% |
| Mining, quarrying, oil & gas extraction | 24.5% |
Among these industry groups, agriculture, forestry, fishing and hunting had the highest ten-year survival rate at 50.5%.
Mining, quarrying, and oil and gas extraction had the lowest at 24.5%.
A Note About the Wholesale Trade Figure
The underlying BLS industry table reports a 30.1% ten-year survival rate for wholesale trade.
An accompanying sentence on the BLS page gives a different figure.
StartupWerx uses 30.1% because it is the value reported in the underlying 2013–2023 survival table.
This is an example of why StartupWerx checks source tables rather than relying solely on summaries.
Industry Survival Changes Over Time
Looking at the full survival path provides more information than looking only at year ten.
Construction
For the March 2013 cohort:
| Age | Construction Survival |
|---|---|
| 1 year | 76.0% |
| 2 years | 68.1% |
| 3 years | 62.8% |
| 4 years | 58.2% |
| 5 years | 53.9% |
| 6 years | 50.6% |
| 7 years | 46.7% |
| 8 years | 44.6% |
| 9 years | 42.4% |
| 10 years | 40.1% |
Professional, Scientific & Technical Services
For the same cohort:
| Age | Professional / Technical Survival |
|---|---|
| 1 year | 77.0% |
| 2 years | 66.0% |
| 3 years | 57.8% |
| 4 years | 51.6% |
| 5 years | 46.3% |
| 6 years | 42.0% |
| 7 years | 38.0% |
| 8 years | 35.7% |
| 9 years | 33.3% |
| 10 years | 30.9% |
At one year, the two industries were relatively close:
76.0% vs. 77.0%
By year ten:
40.1% vs. 30.9%
That illustrates why industry survival is best viewed as a trajectory rather than a single first-year statistic.
Industry Rankings Are Not Permanent
A survival table describes a specific cohort over a specific period.
It does not establish that one industry is permanently “safer” than another.
An older BLS comparison illustrates the point.
For the 2004 birth cohort, BLS reported:
Health Care & Social Assistance
- 5-year survival: 56.9%
- 11-year survival: 40.5%
Construction
- 5-year survival: 40.8%
- 11-year survival: 25.4%
Those figures differ substantially from the 2013 cohort.
For example, construction’s 2013 cohort had a 53.9% five-year survival rate and 40.1% ten-year survival rate.
Economic conditions and cohort timing matter.
Historical survival statistics should therefore not be turned into permanent industry rankings.
Why Cohort Matters
A cohort is a group of establishments that began during the same period.
Tracking a cohort answers a specific question:
Of the establishments that began together, what share remained over time?
That differs from measuring all currently operating businesses.
An established company that has operated for 25 years has already survived many early risks.
A population containing mature businesses therefore cannot be interpreted the same way as a population composed entirely of new establishments.
When evaluating any business survival statistic, ask:
- When did the businesses start?
- How long were they followed?
- Does the source measure establishments or firms?
- Does it cover employer businesses, nonemployers or both?
- Which industries are included?
- How does the source define survival?
- What economic conditions occurred during the observation period?
Without that context, even a technically accurate percentage can become misleading.
Employer Establishments Are Not All U.S. Businesses
This is another major limitation of the popular “business failure rate” claim.
The BLS establishment-survival statistics discussed in this guide are based on employer establishments.
But millions of U.S. businesses operate without employees beyond their owners.
These can include:
- Independent consultants
- Freelancers
- Sole proprietors
- Creators
- Contractors
- Owner-operated online businesses
- Other nonemployer businesses
A survival rate derived from employer establishments should not automatically be applied to every one of those businesses.
Census Research Shows Why the Population Definition Matters
Recent Census Bureau research has begun examining startup dynamics using data that include nonemployer firms and their transitions into employer status.
The Census researchers note that among nearly 30 million registered U.S. businesses in the population they studied, fewer than six million had employees beyond the business owners.
Their research specifically investigates:
- Startup survival
- Startup exit
- Job creation
- Transition from nonemployer to employer status
The key lesson for interpreting survival statistics is straightforward:
The population being measured matters.
A study beginning with employer establishments and a study beginning with nonemployer firms are not measuring identical groups.
StartupWerx therefore does not combine the two into one universal “small business survival rate.”
Establishment Survival, Firm Shutdown and Business Failure Are Different Concepts
These terms should not be used interchangeably.
Establishment Survival
Tracks whether an establishment from an original cohort continues operating over time.
Establishment Birth or Death
Business-dynamics programs use defined statistical rules to identify the entry and exit of establishments.
Firm Startup or Shutdown
Tracks the beginning or end of the broader firm rather than necessarily one individual establishment.
Business Failure
This is a less precise everyday term.
It can imply:
- Insolvency
- Financial distress
- An unsuccessful business model
- Inability to continue operating
Those concepts are not identical to an establishment failing to survive in a longitudinal statistical series.
What Survival Data Tell Us—and What They Don’t
Survival Data Can Tell Us
- How survival changed over time for a defined cohort
- How industries differed within that cohort
- When the largest cohort-level declines occurred
- How historical cohorts compare
- How many establishments remained under the source methodology
Survival Data Cannot Tell Us by Themselves
- Why every establishment stopped operating
- Whether every closure represented financial failure
- Whether every surviving business was profitable
- How much surviving owners earned
- Whether a specific new business will survive
- What the eventual survival rate will be for businesses launched in 2026
That distinction is central to interpreting the statistics responsibly.
Survival Statistics Are Benchmarks, Not Individual Predictions
Suppose a particular historical industry cohort has a five-year survival rate of 55%.
That does not establish that a new business entering that industry today has exactly a 55% probability of surviving five years.
The statistic describes a historical population.
An individual business can differ in:
- Capital
- Debt
- Owner experience
- Location
- Pricing
- Competition
- Customer demand
- Operating costs
- Management
- Marketing
- Cash reserves
- Timing
Historical survival rates provide context.
They do not determine an individual company’s outcome.
StartupWerx Business Survival Framework
Instead of treating survival statistics as destiny, StartupWerx recommends using them to identify risks that founders can investigate before and after launch.
We group those risks into five areas.
1. Demand Risk
Will enough customers buy the product or service at a workable price?
Research:
- Customer need
- Market size
- Competitors
- Pricing
- Customer acquisition
- Repeat demand
2. Capital Risk
Does the business have enough capital to launch and continue operating?
Evaluate:
- Startup costs
- Working capital
- Debt payments
- Operating reserve
- Equipment
- Inventory
- Payroll
See Cost to Start a Business in 2026 and Business Startup Costs by Industry for StartupWerx planning frameworks.
3. Margin Risk
Does each sale contribute enough to support the business?
Understand:
- Revenue
- Direct costs
- Gross margin
- Customer acquisition cost
- Labor
- Overhead
Revenue alone does not guarantee a durable business.
4. Execution Risk
Can the company consistently deliver what customers are buying?
Consider:
- Staffing
- Suppliers
- Quality
- Technology
- Fulfillment
- Scheduling
- Customer service
- Operational capacity
5. Compliance Risk
Can the company maintain the legal and administrative requirements needed to operate?
This can include:
- Entity maintenance
- Licenses
- Permits
- Insurance
- Taxes
- Payroll compliance
- Industry-specific requirements
Formation is the beginning of the company’s compliance responsibilities—not the end.
StartupWerx Survival Planning Model
A practical planning framework is:
Validated Demand + Sustainable Unit Economics + Adequate Capital + Reliable Operations + Compliance = Stronger Business Foundation
This is not a statistical model.
It does not calculate or predict a company’s survival probability.
It is a StartupWerx planning framework designed to turn historical survival data into questions founders can investigate.
What the First Five Years Suggest for Planning
The March 2013 survival curve provides useful context for business planning.
Before Launch
Validate the business before committing unnecessary capital.
Research:
- Customer demand
- Pricing
- Startup costs
- Competition
- Licensing
- Capital needs
Year 1
The largest overall survival decline in the 2013 cohort occurred during the first year.
Useful planning priorities include:
- Reaching customers
- Preserving cash
- Testing pricing
- Controlling fixed expenses
- Monitoring margins
- Building repeatable operations
Years 2–3
A business may have demonstrated demand while still needing to prove that its economics are sustainable.
Monitor:
- Margins
- Customer retention
- Sales consistency
- Hiring
- Cash flow
- Operating systems
Years 4–5
Surviving longer does not eliminate business risk.
Companies may encounter:
- New competitors
- Rising labor costs
- Changing customer behavior
- Technology shifts
- Financing needs
- Expansion decisions
The historical survival curve becomes less steep, but establishment exits continue beyond year five.
Business Survival Myths the Data Don’t Support
Myth: “Every New Business Has a 50% Chance of Failing”
Historical population statistics do not establish the failure probability of an individual business.
Myth: “Exactly Half of Businesses Fail Within Five Years”
Selected BLS five-year survival rates range from 49.8% to 57.3%.
Myth: “If a Business Closes, It Failed Financially”
Survival data alone do not identify the reason every establishment stopped operating.
Myth: “Once a Business Survives Five Years, It’s Safe”
The March 2013 cohort declined from 50.6% surviving at five years to 34.7% surviving at ten years.
Myth: “90% of Restaurants Fail in the First Year”
The BLS data examined here do not support that claim.
What the Data Say About the Restaurant Failure-Rate Myth
Restaurants are frequently associated with dramatic failure statistics.
The BLS data provide a useful reality check—but they need to be described precisely.
BLS reports an industry category called:
Accommodation and food services
That category is broader than restaurants alone.
For establishments in that category born in March 2013:
| Age | Survival Rate |
|---|---|
| 1 year | 82.5% |
| 2 years | 72.5% |
| 3 years | 65.6% |
| 4 years | 60.3% |
| 5 years | 55.3% |
| 6 years | 51.2% |
| 7 years | 46.6% |
| 8 years | 42.9% |
| 9 years | 41.1% |
| 10 years | 38.2% |
The first-year figure means 82.5% of establishments in this broader industry cohort survived the first year.
That is inconsistent with using this BLS series to support a claim that 90% of these establishments failed during year one.
However, because the BLS category includes accommodation as well as food services, StartupWerx does not present 82.5% as a restaurant-only survival rate.
That distinction is important.
Are New Businesses More Likely to Survive Today?
The historical BLS data do not support a simple permanent trend.
Five-year survival varies by cohort.
Examples include:
- 2006 cohort: 49.8%
- 2010 cohort: 56.0%
- 2018 cohort: 57.3%
The 2018 cohort had the highest five-year survival rate among the selected cohorts in the BLS 20th-anniversary comparison.
But that does not establish a permanent upward trend or tell us what will happen to businesses starting in 2026.
Historical outcomes describe historical cohorts.
They are not forecasts.
We Don’t Yet Know the Five-Year Survival Rate of 2026 Startups
A five-year survival rate requires five years of observation.
A business beginning in 2026 cannot have an observed five-year survival outcome in 2026.
Likewise, its ten-year survival outcome cannot yet be known.
That sounds obvious, but it prevents an important statistical mistake.
A page titled Small Business Survival Rates 2026 can summarize the best survival evidence available in 2026.
It cannot truthfully report the eventual five-year survival rate of the 2026 startup cohort.
What About Businesses Started During the Pandemic?
The 2018 cohort is particularly interesting because those establishments encountered the pandemic recession during their first five years.
BLS reports that this cohort nevertheless had a 57.3% five-year survival rate, the highest among the selected cohorts in its comparison.
That does not mean the pandemic improved survival.
It means the observed cohort result was 57.3%.
Determining why a cohort produced a particular survival rate requires more evidence than the survival percentage alone.
Business Formation and Business Survival Measure Different Things
A high level of new business activity can coexist with substantial business exit.
The Census Bureau’s Business Dynamics Statistics provide measures including:
- Establishment births
- Establishment deaths
- Firm startups
- Firm shutdowns
- Job creation
- Job destruction
Businesses continually enter, expand, contract and exit.
That movement is part of business dynamism.
A large number of new business applications therefore does not mean existing businesses have stopped closing.
Likewise, business exits do not mean entrepreneurship has stopped.
For current formation activity, see Business Formation Statistics 2026.
Survival Is Not the Same as Business Success
A business can survive without producing the outcome its owner wanted.
A surviving company might:
- Generate little profit
- Pay the owner less than expected
- Accumulate debt
- Lose market share
- Require excessive owner hours
- Produce a poor return on invested capital
Likewise, survival data do not tell us the value of the business or the owner’s financial return.
That means survival should not be confused with:
- Profitability
- Growth
- Owner income
- Business value
- Return on investment
A stronger business scorecard measures operating performance as well as continued existence.
StartupWerx Business Durability Scorecard
When evaluating a business idea or operating company, monitor:
| Area | Question |
|---|---|
| Demand | Are customers consistently buying? |
| Revenue | Is revenue becoming predictable? |
| Gross margin | Is enough money left after direct costs? |
| Cash flow | Can the business meet its obligations? |
| Operating reserve | Can it absorb unexpected problems? |
| Customer concentration | Is revenue overly dependent on a few customers? |
| Acquisition | Can the company acquire customers economically? |
| Retention | Do customers return or renew? |
| Operations | Can the company deliver consistently? |
| Compliance | Are required filings, licenses and taxes current? |
This scorecard does not predict survival.
Its purpose is to focus attention on business conditions that founders can actually monitor.
How to Use Survival Statistics When Starting a Business
Survival data are most useful when they change the questions you ask.
Instead of asking:
“Will my business be one of the 50%?”
Ask:
“What could prevent this business from becoming durable?”
Then investigate:
Market
Is there enough demonstrated demand?
Pricing
Can the company charge enough to support its cost structure?
Capital
How much money is needed before the business can support itself?
Operating Reserve
How long can the company continue through slower-than-expected sales?
Customer Acquisition
Can customers be acquired at an economically sustainable cost?
Margin
Does the business retain enough money from each sale?
Operations
Can it deliver consistently as sales increase?
Compliance
What licenses, filings, taxes and insurance must remain current?
Historical survival statistics cannot answer those questions for you.
But they provide a reason to answer them before committing substantial capital.
Ready to Build Your Business?
Survival statistics shouldn’t be used to discourage entrepreneurship.
They should improve planning.
Before launching, understand your market, estimate startup costs, build an operating reserve and choose a legal structure appropriate for the business.
StartupWerx can help you move from planning to formation.
Frequently Asked Questions
What percentage of small businesses survive the first year?
For U.S. private-sector business establishments born in March 2013, 79.6% were still operating one year later.
This is an employer-establishment survival statistic from BLS and should not be treated as a universal rate for every type of small business.
What percentage of small businesses survive five years?
It varies by cohort.
In the selected BLS comparison, five-year survival ranged from 49.8% for establishments born in 2006 to 57.3% for establishments born in 2018.
For the March 2013 cohort followed separately by BLS, 50.6% survived five years.
What percentage of small businesses survive ten years?
For U.S. private-sector business establishments born in March 2013, 34.7% were still operating in March 2023.
That statistic applies to the defined BLS establishment cohort, not every type of U.S. business.
Is it true that half of small businesses fail within five years?
That is an oversimplification.
Selected BLS cohorts had five-year establishment survival rates ranging from 49.8% to 57.3%.
The underlying statistics measure establishment survival, and non-survival should not automatically be labeled financial failure.
What year is hardest for a new business?
For the March 2013 BLS establishment cohort, the largest overall decline occurred during the first year.
Survival fell from 100.0% to 79.6%, a decline of 20.4 percentage points.
That does not establish that year one is always the hardest period for every business or every cohort.
What percentage of food-service businesses survive five years?
For the broader BLS accommodation and food services category, 55.3% of establishments born in March 2013 survived five years.
Because the category includes accommodation as well as food services, this should not be described as a restaurant-only survival statistic.
Do 90% of restaurants fail in the first year?
The BLS data examined in this guide do not support using that claim for the broader accommodation and food services category.
For establishments in that category born in March 2013, 82.5% survived the first year.
Because the category is broader than restaurants, the statistic should not be presented as a restaurant-only rate.
Which industry had the highest 10-year survival rate?
For the specific March 2013 BLS cohort, agriculture, forestry, fishing and hunting had the highest ten-year survival rate among the industry groups shown, at 50.5%.
That does not establish that it is permanently the “safest” industry.
Which industry had the lowest 10-year survival rate?
For the same cohort, mining, quarrying, and oil and gas extraction had the lowest ten-year survival rate among the industry groups shown, at 24.5%.
Industry outcomes can differ across cohorts and economic periods.
Does closing a business mean it failed?
Not necessarily.
The survival statistic tells us whether an establishment remained in the surviving cohort.
It does not, by itself, establish the financial or personal reason an establishment ceased operating.
Are sole proprietors included in these survival rates?
The traditional BLS establishment-survival statistics discussed here are based on employer establishments covered by the underlying employment data.
They should not automatically be applied to every nonemployer sole proprietorship, freelancer or independent business.
Can survival rates predict whether my business will succeed?
No.
Historical survival rates describe groups of establishments.
An individual company’s outcome depends on its market, capital, costs, management, competition, execution and many other circumstances.
What is the small business survival rate in 2026?
There is no single universal “2026 small business survival rate.”
In 2026, the best available evidence includes completed historical cohorts.
A business launched in 2026 has not yet existed long enough to produce an observed five- or ten-year survival rate.
Sources and Methodology
StartupWerx built this guide primarily from U.S. Bureau of Labor Statistics Business Employment Dynamics data and uses Census Bureau material to clarify the distinction between establishments, firms and nonemployer businesses.
Primary Sources
- U.S. Bureau of Labor Statistics — Business Employment Dynamics 20th Anniversary
- U.S. Bureau of Labor Statistics — 2013 Establishment 10-Year Survival
- U.S. Bureau of Labor Statistics — Entrepreneurship and the U.S. Economy
- U.S. Bureau of Labor Statistics — Establishment Survival by Cohort
- U.S. Bureau of Labor Statistics — Selected Industry Survival, 2004 Cohort
- U.S. Census Bureau — Business Dynamics Statistics
- U.S. Census Bureau — Statistics of U.S. Businesses Glossary
- U.S. Census Bureau — Startup Dynamics: Transitioning from Nonemployer Firms to Employer Firms, Survival, and Job Creation
Five-Year Cohort Methodology
The selected five-year comparison uses the BLS Business Employment Dynamics 20th-anniversary analysis.
BLS reports:
- 1994 cohort: 54.3%
- 2001 cohort: 52.3%
- 2003 cohort: 55.3%
- 2006 cohort: 49.8%
- 2010 cohort: 56.0%
- 2018 cohort: 57.3%
StartupWerx does not average these percentages into an invented national survival rate.
Each represents a different birth cohort.
2013 Ten-Year Cohort Methodology
The principal year-by-year and industry tables use establishments born in March 2013 and followed through March 2023.
BLS reports total private-sector survival of:
- 1 year: 79.6%
- 2 years: 68.9%
- 3 years: 61.4%
- 4 years: 55.3%
- 5 years: 50.6%
- 6 years: 46.7%
- 7 years: 42.8%
- 8 years: 39.9%
- 9 years: 37.6%
- 10 years: 34.7%
Using one cohort for this table avoids mixing survival percentages from businesses born in different periods.
Establishment vs. Firm
StartupWerx preserves the distinction between establishments and firms.
Census defines a firm as a business organization consisting of one or more establishments under common ownership or control within its statistical framework.
Business Dynamics Statistics separately report measures including establishment births and deaths and firm startups and shutdowns.
For that reason:
Establishment non-survival should not automatically be described as failure of an entire company.
Employer vs. Nonemployer Businesses
The BLS survival series discussed here does not represent every nonemployer business.
Census research published in 2025 specifically examines startup dynamics involving nonemployer firms and their transition to employer status.
StartupWerx cites that research to demonstrate why the population definition matters, not to replace the BLS survival series with a different survival rate.
Industry Methodology
Industry survival figures are reported using the BLS classifications for the March 2013 cohort.
They should not be generalized beyond the category.
For example:
Accommodation and food services ≠ restaurants only
and:
Professional, scientific and technical services ≠ consulting only
Wholesale Trade Source Note
The BLS 2013–2023 industry table reports wholesale trade survival at:
30.1% in 2023
An accompanying BLS sentence gives a different value.
StartupWerx uses 30.1% because that is the value contained in the underlying survival table.
StartupWerx Methodology
StartupWerx adds two planning frameworks to the government data.
StartupWerx Survival Planning Model
Validated Demand + Sustainable Unit Economics + Adequate Capital + Reliable Operations + Compliance = Stronger Business Foundation
StartupWerx Business Durability Scorecard
The scorecard evaluates areas including:
- Demand
- Revenue
- Margin
- Cash flow
- Operating reserves
- Customer concentration
- Customer acquisition
- Retention
- Operations
- Compliance
These are StartupWerx planning frameworks.
They are not BLS or Census statistical models and do not predict an individual company’s probability of survival.
Important Limitations
The survival statistics in this guide should not be interpreted as:
- Individual business failure probabilities
- Measures of profitability
- Measures of owner income
- Measures of business value
- Universal statistics for nonemployer businesses
- Proof of why an establishment ceased operating
- Permanent rankings of industries
- Predictions for businesses starting in 2026
The data describe historical populations under specific statistical definitions.
Continue Building Your Business
Understanding survival statistics is most useful when it improves how you plan.
For broader guidance, see Form, Manage, and Grow a Small Business.
Continue with:
- Small Business Statistics 2026
- Business Formation Statistics 2026
- Cost to Start a Business in 2026
- Business Startup Costs by Industry
- LLC Formation Costs by State
- LLC vs Corporation Costs by State
Ready to Start Your Business?
Historical statistics cannot tell you exactly what will happen to your company.
But understanding demand, costs, capital requirements and business structure can help you make better-informed decisions before launch.
StartupWerx can help you move from planning to formation.
Still Exploring Business Ideas?
If you’re comparing opportunities, use survival data as context—not as a prediction of what will happen to your company.
Use StartupWerx to explore business ideas and identify opportunities that fit your experience, resources and goals.