New Business Registrations Plunge 5% in 2024— Entrepreneurs Face Growing Headwinds

Business formation in the United States declined by 5% in 2024, with 7,043 fewer new businesses registered in December 2024 compared to the previous year, according to new data from Registered Agents, Inc. The slowdown reflects a mix of economic uncertainty, inflation, and election-year caution, which weighed on new business creation across multiple states.

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Registered Agents, Inc announced today the launch of the Monthly Business Formation Report, a new resource providing detailed insights into national and state-level business formation trends. The report examines month-over-month and year-over-year changes, identifying key factors influencing new business registrations nationally and in all 50 states.

Key Findings from the December 2024 Business Formation Report

Nationally, 389,215 new businesses were registered in December 2024, reflecting a 3% increase from November but a 5% year-over-year decline. Inflation, regulatory uncertainty, and shifting interest rates contributed to a more cautious investment environment for startups. Some states saw a strong rebound in December, while others continued to struggle with economic headwinds.

States with Notable Growth in Business Formation

Utah saw a 42% surge in business formations in December, signaling a strong rebound after a mid-year slowdown. North Dakota saw a 26% increase, reflecting continued economic gains from record oil production and the lowest unemployment rate in the country at 1.9%. Oklahoma’s business formations grew by 20%, driven by a growing startup ecosystem and business-friendly policies.

States Facing the Strongest Slowdowns

New Mexico experienced a 38% decline in business formations as rising unemployment and regulatory changes in the energy sector led to a sharp drop in new business registrations. Louisiana saw a 20% decline, as tax reform uncertainty and slowing post-hurricane recovery efforts led to hesitancy in new business filings. Vermont’s business formations fell by 12%, with a shrinking population and declining tax revenue making it harder for entrepreneurs to launch new ventures.

State-by-State Business Formation Data – December 2024

A full breakdown of state-level data is available in the Registered Agents, Inc Business Formation Report. Jon Garrison, Treasurer at Registered Agents, Inc, emphasized the significance of tracking business formation trends to understand the economic climate. “A 5% decline in business formations isn’t just a number—it’s a reflection of shifting confidence among American entrepreneurs. Inflation, regulatory uncertainty, and political changes are making it harder for small businesses to get off the ground. At the same time, states with strong infrastructure and startup incentives continue to attract new businesses at a rapid pace. Our Monthly Business Formation Report will give entrepreneurs, business leaders, and policymakers the insights they need to support and sustain American entrepreneurship in 2025 and beyond.”

About the Monthly Business Formation Report

Registered Agents Inc’s business formation data is calculated from data aggregated from federal and state Corporations Division data alongside our own research. We looked at rolling 12-month totals and compared year-over-year changes for December between 2023 and 2024.

About Registered Agents Inc

Registered Agents Inc is a trusted provider of business formation and compliance services, having helped over one million entrepreneurs nationwide. Known for making business setup fast and seamless, Registered Agents Inc enables entrepreneurs to establish their company, domain name, website, phone number, and professional email in just 10 minutes. The company’s platform simplifies the complexities of starting and maintaining a business, offering essential services such as registered agent representation, compliance management, and business entity formation. With a commitment to efficiency and ease, Registered Agents Inc empowers businesses from startup to success.

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