The Lone Star state is one of the best markets in the country for new business growth in 2023.
The U.S. economy has experienced a wave of record-breaking job growth in the first half of 2023, with Texas ranking among the top 5 states in the nation for new business openings, according to a recent economic impact report by Yelp.
“National business openings on Yelp from January through July 2023 have surpassed openings from the same time period last year, a year which hit an all-time high for new businesses,” Yelp said in the report. “This strong national growth is reflected across all categories on Yelp and for the first time, every U.S. state, including DC, surpassed new business openings compared to pre-pandemic levels.”
Consumers and businesses have been on high alert for indicators of the economy’s health this year, and nationwide data on 2023 business openings are pointing to positive momentum for the rest of the year, according to Samantha Auerbach, data science manager at Yelp.
“Texas alone saw 50,180 new businesses open in January through July this year, the third most new business openings in the nation, following California and Florida,” Auerbach told The Dallas Express.
“Notably new business openings in Texas increased by 21% compared to the same time period the year prior. Hotels & travel drove the most growth in Texas with new business openings up 39% compared to the same time period in 2022, followed by event services (up 32%), home services (up 31%), and auto services (up 28%),” she said.
As for the local market, Auerbach notes that similar to the categories that saw notable growth statewide in Texas, the categories with the most significant percentage growth in Dallas are automotive services (up 43%), event services (up 36%), active life (up 35%), hotels & travel (up 30%), and home services (up 27%).
In terms of total business openings in 2023, home services saw the most, with 5,471 businesses opening in Dallas from January to July 2023, she told The Dallas Express.
“The number of small businesses opening over the last two years broke records, and Yelp’s new report signals our community’s growth is far from being over,” Keith Hall, president and CEO of the National Association for the Self-Employed, which supports entrepreneurs and small business owners across the nation, told NBC 5 DFW.
“Texas is playing a major role in helping to lead that growth,” Hall said. “People recognizing that they have more flexibility, they have more control, there’s this intangible value, that you’re building something for your family, for your own legacy, as opposed to generating corporate profits for a bigger company,” he explained.
Some local entrepreneurs are already recognizing the flexibility and power that comes with running and owning a business. For instance, Dallas-based Elemental Yoga & Meditation opened in Oak Cliff earlier this year and has already been well-received and embraced by the local community.
“Any type of natural practices were kind of limited in that area. So, I wanted to create a sacred and safe space for individuals within the community to have a place to practice yoga, try yoga, and meditation,” said owner Vanna Collins, per NBC 5.
Even with the tightening economic conditions in the U.S. and fears of a recession in late 2023 or early 2024, each passing month has resulted in new all-time highs and “growth of at least 15%,” Yelp says in the report.
Despite the strong labor market in North Texas, entrepreneurs looking to get their businesses off the ground in Dallas often encounter barriers to success. Such obstacles include a slow permitting process, rampant crime, and a homelessness crisis, which perpetuates challenges for small businesses and local entrepreneurs, as previously reported by The Dallas Express.
The Dallas Express reached out to Yelp for a statement on the report and to request more information about how California bested Texas in 2023 but had not heard back at the time of publishing.
To view the full report, click here.