Many Americans dream of quitting their job and becoming their own boss. Whether the goal is to live the laptop lifestyle or turn a creative pursuit into a full-time business, entrepreneurship offers flexibility and excitement, but it is not without risks. While the potential upside of starting a successful business is appealing, it often takes years for a new firm to become profitable, and many entrepreneurs do not earn as much as they did in their previous jobs. According to data from the U.S. Census Bureau, the median annual income for full-time entrepreneurs is $50,000, which is the same as the median income for all full-time workers.
At a more granular level, full-time entrepreneurs (defined here as self-employed workers in their own incorporated or unincorporated businesses) tend to report higher incomes than full-time employees at for-profit businesses. However, the typical full-time entrepreneur makes less than both full-time employees of non-profit organizations and full-time government workers. Interestingly, Census data shows that federal employees enjoy the highest median income at $65,000 per year, followed by non-profit employees at just under $53,000.
While nationally the median income for entrepreneurs is the same as the median income for all workers, there are big differences at the state and city level. At the high end, entrepreneurs in Rhode Island and North Dakota have median incomes that are 28.3 and 20.0 percent higher, respectively, than the median income of all workers. On the low end, entrepreneurs in Vermont and Delaware have median incomes that are 18.8 and 16.7 percent lower, respectively, than that of all workers.
To determine the metropolitan areas with the most successful entrepreneurs, researchers at ZenBusiness analyzed data from the U.S Census Bureau. The researchers ranked metros according to the income premium for entrepreneurs, which is defined as the percentage difference between the median income for full-time entrepreneurs and the median income for all full-time workers.
Here are the top 15 large metropolitan areas with the most successful entrepreneurs:
For more information, a detailed methodology, and complete results for all metros, you can find the original report on ZenBusiness’s website: https://www.zenbusiness.com/