According to new research from GoDaddy and UCLA, the U.S. cities with the most microbusiness activity during the fourth quarter of 2022 are San Jose, San Francisco, Washington, D.C., Denver, San Diego, and Austin. At the national level, the GoDaddy/UCLA Anderson Forecast Microbusiness Activity Index (MAI) shows that overall microbusiness activity declined slightly after peaking in April 2022.

Key Takeaways from the Q4 2022 MAI Report:

• One online microbusiness entrepreneur is associated with the creation of an additional 6.7 jobs at the county level.
• The top states for microbusiness activity are Colorado, Utah, Maryland, and Oregon.
• Across America’s metro areas, San Jose, San Francisco, Washington, D.C., Denver, San Diego, and Austin lead the nation in microbusiness activity.
• Metro areas like San Antonio, Detroit, and Miami, with historically lower levels of infrastructure scores (e.g., broadband subscriptions, home computers, and varying education attainment), are catching up with their peers with higher infrastructure growth rates.
• Due to rising interest rates and a slowing economy, the overall MAI declined from its peak of 106.5 in April 2022 to 102.7 in December 2022.

“Microbusiness owners, which typically employ 10 or fewer employees, have an outsized economic impact,” said Alexandra Rosen, senior director of Venture Forward, GoDaddy’s five-year-old microbusiness impact research initiative. “We found that a single microbusiness owner can add nearly 7 jobs at the county level, emphasizing the importance of supporting entrepreneurs to spur job growth in local communities.”

Twice a year, the UCLA Anderson Forecast publishes an updated report and MAI with GoDaddy’s Venture Forward initiative. Venture Forward quantifies the economic impact made by entrepreneurs by providing insight into their needs, demographics, challenges, and behaviors. The current report represents the Q4 2022 update and contains data through December 2022 for the nation, individual states, metros, and counties across the U.S.

“The slight decline in microbusiness activity we observed in the fourth quarter of 2022 tracks closely with wider macroeconomic conditions,” said William Yu, Economist at UCLA Anderson Forecast. “However, we observed that regions with the highest levels of human capital and digital infrastructure had the strongest increases in microbusiness activity.”

Read the full GoDaddy/UCLA Anderson Forecast MAI update for the fourth quarter of 2022.