Small businesses have been a vanishing part of the American landscape for decades now, and the trend seems only to be gaining speed. Between 2005 and 2015, the number of small retailers—those with fewer than 100 employees—fell by 85,000. That's more than one in five. Small manufacturers likewise saw their ranks shrink by over 35,000, a drop of 13 percent. A mere twenty years ago, local banks and credit unions accounted for nearly half of the banking industry. Now they make up only about one-fifth. And so it has gone across most industries.
The shuttering of existing businesses is only part of the story behind these figures. There's something else at work, too: we're no longer creating new businesses at the pace we once did. The number of new firms launched each year in the U.S. has fallen by nearly two-thirds since 1980. This drop-off has paralleled other stark trends, including stagnating wages, growing inequality, and a widening gap between the fortunes of a few thriving metros and the persistent malaise that has taken hold in other regions. All of these trends began around the same time, and recent scholarship suggests that they may all be a consequence of the same root cause: nearly every corner of the economy, from milk processing to hospital care, has become dominated by an ever-smaller number of ever-larger corporate giants.
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