Continued Surge in Franchising Helps Bolster U.S. Economy

As the U.S. economy experiences fits and starts in its recovery, the franchising industry continues to serve in a leadership position, outpacing the rest of the economy for six straight years.


By Steve Olson, CFE

Franchising is the world’s most successful strategy for small business expansion. Championing free enterprise and the American Dream, the strength of our entrepreneurial business model serves as a true benefactor for small business ownership, the economy and employment. During 2016, new franchise brands are entering the market at the rate of one every day. 

There’s no question that the increase in jobs throughout the U.S. is thanks in large part to the growing demand for franchises. Franchise brands re-focused on greater franchisee profitability and better practices during the economic downturn in 2008-2009. As a result, the franchise industry continues to lead the way with employment opportunities.

IFA recently completed its 2016 Franchise Business Economic Outlook study with IHS Economics and found that franchises will add an additional 278,000 jobs to the already robust economy for a total of 1.7 percent, or 795,932 jobs nationwide by the end of 2016.

Hiring trends are also strong, with the IFA expecting increases of 3.1 percent, totaling 9.1 million jobs across the country, a rise of roughly 300,000 from 2015 figures.

It’s certainly clear that this continued surge is helping to fuel the economy. The rise in franchising has led to a 20 percent increase in job growth over businesses that don’t franchise. The nationwide unemployment rate is also declining, with the most current figures at 5 percent; half of what was projected five years ago.

Franchisors and their franchisee counterparts are continuing to benefit in multiple sectors. While the industry transcends more than 300 business categories, IFA identifies 10 general sectors of franchising: 

  • Automotive
  • Business Services
  • Commercial & Residential Services
  • Lodging
  • Personal Services
  • Quick Service Restaurants
  • Real Estate
  • Retail Food
  • Retail Products & Services
  • Table/Full Service Restaurants

In the coming year, brands in the lodging sector will experience the most notable growth with 6.6 percent expected output, while retail stores and restaurants will continue to follow closely behind. In December 2015, restaurants added an additional 32,700 employees, a 5 percent increase over 2014.

So what makes franchising an attractive business model for buyers? Profitability, resiliency and franchise community! I hope to see everyone at the IFA Convention in San Antonio from Feb. 20-23.


Steve Olson, CFE, Chief Development Advisor for Legacy Franchise Group, is a 30-year veteran of franchise development and author. Find him at