Massachusetts Is Experiencing More Business Closures than Openings

The BLS Business Employment Dynamics survey tracks job changes for business establishments across the country. According to BLS, this survey is good for “measur[ing] what is happening to establishments,” tracking establishment openings, closures, expansions, and contractions.

The latest data for Massachusetts revealed some alarming trends: the Commonwealth had a disproportionately high rate of business closures compared to business openings.

In Q2 2024 (which covers April through June 2024), Massachusetts had a net loss of 5,333 business establishments (roughly -1.9% of all establishments documented in Q2). This is the largest net loss for the state in any Q2 since COVID losses in 2020.

This is nearly double the rate of net closures experienced nationwide. If you compare Massachusetts to key competitors – this trend looks even worse. New Hampshire experienced a net closure rate six times less than Massachusetts, and Florida even had a positive change – with more openings than closings in Q2. 

The survey also measures surviving existing establishments and their growth. In Q2 2024, Massachusetts also had more businesses contracting (i.e. reducing their employment) than expanding. This marks the fourth consecutive quarter where the Commonwealth has had more establishments downsizing instead of expanding.

While Massachusetts has historically been a home to business innovation and growth, policymakers should heed these early signs as a warning that the current business environment may be driving businesses out of operation.