Startup Surge: Yelp Data Shows Massive Amounts Of New Business Openings

New business applications in the U.S. from June 2020 through May 2021 experienced the greatest increase on record since 2004 as more people looked for increased flexibility in the way they work or turn their hobbies into full-time jobs, according to recent data.

In second-quarter 2021, about 150,940 new businesses listed their openings on Yelp, surpassing pre-pandemic levels by 8%, compared with second-quarter 2019, and up from 146,160 in first-quarter 2021. This could be good news for Google’s and Facebook’s respective advertising businesses, which depend on small businesses to advertising through their services.

Home services accounted for 51,445 of new businesses opened in the second quarter of 2021, up 48% compared with pre-pandemic levels in second-quarter 2019.

Yelp data reveals an increase in new business openings across lawn services by 189% to 3,165 openings, while home cleaning rose 139% to 6,558; drywall installation and repair rose 119 to 1,253 and painters rose by 96% to 3,787.



Local services saw 16,047 new businesses open in second-quarter 2021 -- up 30% compared to pre-pandemic levels in second-quarter 2019. Nanny services rose 91% to 86 businesses on Yelp's platform; septic services rose 43% to 208; carpet cleaning rose by 62% to 1,282; junk removal and hauling services rose by 162% to 2,328, and junkyards by 111% to 38 businesses.

Professional services had 13,907 new businesses open in second-quarter 2021, a 21% increase compared to pre-pandemic levels. As offices in many states re-open, people opened billing service businesses. Yelp counted 67 new listings, up 52%, for billing services. Office cleaning saw a 120% bump to 4,256 businesses; business consulting rose by 26% to 1,204; security services rose 25% to 271; and personal assistants rose by 57% to 129.

About 60,502 businesses across the U.S. reopened in Q2 2021, marking the highest volume of in the past year. In April, there were 38,725 re-openings, the largest monthly volume since May 2020. As businesses re-open, each will require search and social organic and paid ad services to alert consumers they adhere to safety guidelines and convince the 59% of U.S. residents 18 years and older it’s safe to shop in their stores.

Restaurant and food businesses, as well as retail businesses experienced the highest number of businesses that reopened in Q2 with 22,441 and 13,700 re-openings, respectively.

While businesses reopened, the return to activities that were upended by social distancing guidelines saw substantial increases. Those businesses as reported on Yelp’s platform include the reopening of 592 gyms; 644 waxing salons; 1,214 hair salons; 1,385 brunch restaurants; 531 massage therapy; and 275 cosmetic and beauty supply stores.

Despite businesses re-opening in every U.S. state except Hawaii, the Delta variant continues to create uncertainty.

The increase in COVID-19 vaccinations in April led to greater growth in consumer interest in businesses during May and June across the U.S. The states with a high voting registry of democrats saw a greater increase in vaccinations in April, followed by more consumer interest.

It’s not always the case, but per the Yelp report, the South accounts for the largest share of fewer vaccinated people, and generally lower increases in average monthly consumer interest levels.

The northeast saw an increase in vaccinations followed by an increase in consumer interest. This is the part of the U.S. with the largest share of vaccinated people. The west is the main driver of outliers, and is the region with the most instances of less vaccinated populations and higher increases in average monthly consumer interest.

Of the 150 counties with the highest populations, nine out of 10 counties with the largest increase in vaccinated people in April saw a 21% or higher increase in average monthly consumer interest in May and June. Similarly, seven out of 10 counties, with the smallest changes in vaccinated people, saw a 20% or less increase in average monthly consumer interest.

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