Small Businesses Drove 92% of May Hiring

Businesses with fewer than 1,000 employees were responsible for nearly 93% of all hires in privately held U.S. companies during May, according to data from the Bureau of Labor Statistics. This indicates a significant reliance on smaller enterprises for job creation within the private sector. Companies employing between 10 and 49 individuals represented the largest portion of these hires, followed closely by those with 50 to 249 employees. This trend contrasts with the hiring patterns of very large corporations.

Analysis of federal data by Business Insider reveals that companies with 5,000 or more employees have consistently accounted for only 1% to 2% of total hires over the past two decades. In May, these large employers posted approximately 3% of job openings but made fewer than 2% of the hires. In comparison, businesses with 50 to 999 employees were responsible for about 39% of job openings and approximately 43% of hires during the same month. While some economists note that the reporting structure of large, complex organizations might lead to them being categorized as multiple companies, the data points to a clear trend favoring smaller businesses in hiring.

Recent years have seen a notable increase in hiring primarily within businesses that have between 1 and 49 employees. This growth in smaller businesses may be influenced by several factors, including the ongoing impact of AI automation and a strategic recalibration following pandemic-era overhiring by larger corporations. Many major companies, including Visa, Meta, Oracle, and Amazon, have announced significant layoffs in recent months. Visa, for instance, recently stated it would lay off 2,600 of its approximately 34,000 global employees. Meta laid off 8,000 employees from its workforce of 78,000 at the time of its announcement.

The landscape for entrepreneurship is also evolving, with AI playing a role in lowering barriers to entry for new businesses. A CNBC analysis of U.S. Census Bureau data indicated that entrepreneurs filed 1.56 million business applications from November 2025 through January 2026, marking the highest number for any three-month period since at least 2004. Many entrepreneurs cited AI as a factor that simplifies the process of launching a startup. The pressure on smaller businesses to fill positions may also be heightened due to their smaller headcounts, making each hire more critical to their operations.