WASHINGTON — The International Franchise Association (IFA) today released its 2023 Franchising Economic Outlook report estimating Kentucky will add 179 new franchise businesses in 2023, creating 3,254 new jobs. These local businesses continue to deliver jobs and business ownership opportunities, despite economic uncertainty across all industries and in daily life.
“Even with today’s economic headwinds, franchises in Kentucky continue to grow, provide career-building jobs for their employees, and give back to their local communities,” IFA President/CEO Matt Haller said. “After an historic year of growth during the post-pandemic recovery, franchising is predicted to exceed pre-pandemic growth levels – showing the power of the business model and its distinct advantages for prospective business owners.”
The full report and state data is available here.
The 2023 Franchising Economic Outlook is IFA’s annual study detailing the franchise sector’s performance for the past year and projected economic outlook for the year ahead, as well as an in-depth state outlook for all 50 states and Washington, D.C.
In Kentucky:
- Franchise establishments will increase by 179 units, at a rate of 1.6%, to a total of 11,485 units.
- Franchising will add approximately 3,254 new jobs in 2023, to a total of 123,948 franchise employees.
- Economic output by franchises increased to $11.8 billion in 2022, or 4.7%. Output growth is expected to continue into 2023 by 3.9% to $12.3 billion.
Key highlights on the national level include:
- The overall number of franchise establishments will increase by almost 15,000 units in 2023, or 1.9%, to 805,000 units.
- Franchising will add approximately 254,000 jobs in 2023. Growing at 3.0%, total franchise employment is forecasted to reach 8.7 million.
- From $825.4 billion in 2022, the total output of franchised businesses — the measure of total economic activity in nominal dollars — will increase by 4.2% to $860.1 billion in 2023.
- Franchises’ GDP share of the overall economy will remain stable at 3%. Compared with 2022, franchises’ GDP — the monetary value of all the finished goods and services produced within U.S. borders — will grow at a slightly slower pace of 4.2% to $521.3 billion.
- Service-based industries and quick-service restaurants will witness higher growth than other industries.
On the state and regional level, the report shows that states have experienced different rates of franchise business growth due to disparities in business climates, migration trends, the labor market, and major industry investments. On the state level, it is predicted that:
- States in the Southeast and Southwest will experience the fastest upward trajectory of franchise business growth in 2023.
- The top 10 states for franchise growth in 2023 are projected to be: Texas, Illinois, Florida, Georgia, Tennessee, North Carolina, South Carolina, Arizona, Colorado, and Indiana.
- The Southeast region, which has the largest franchise concentration in the U.S., will have an estimated 234,079 total establishments by 2023, employing 2.5 million workers and contributing $250 billion in output to the U.S. economy.
The world’s oldest and largest organization representing franchising, IFA works to enhance franchising and the approximately 790,492 U.S. franchise establishments that support nearly 8.4 million direct jobs and $825.4 billion of economic output, almost 3% of GDP.
