News Summary

Tuscaloosa and Birmingham have been highlighted as two of the top 25 U.S. cities for small business growth, according to a recent BILL report. The report emphasizes the supportive environment these cities have created for small and midsize businesses, contributing to community development and job creation. Alabama stands out with multiple cities making the list, reflecting a growing reputation in fostering small business success amidst changing work dynamics post-pandemic.

Tuscaloosa and Birmingham Named Among Top 25 U.S. Cities for Small Business Growth

Tuscaloosa and Birmingham have been recognized as two of the top 25 cities in the United States for small business growth, according to a recent report published by BILL. This report highlights how these cities have thrived in building a supportive environment for small and midsize businesses (SMBs), which play a crucial role in community development, job creation, and economic stimulation.

Alabama stood out as one of only seven states in the country with multiple cities making the list, underscoring the state’s growing reputation in the realm of small business success. The report indicates that both cities experienced significant growth over the last year, particularly since January 2025, coinciding with the enforcement of new tariffs.

Factors Contributing to Growth

The growth in small businesses in Tuscaloosa and Birmingham can be attributed to various advantageous trends. These include an increase in local consumer spending, a rise in population, and the changing dynamics of work environments following the COVID-19 pandemic. Many businesses have adapted by embracing remote work and digitalization, which paved the way for the creation of numerous new SMBs in these cities.

The report analyzed data on business-to-business (B2B) payments from SMBs across the largest 342 U.S. cities, each with populations exceeding 100,000. This analysis aimed to capture the influence of recent trends such as population mobility and new business setup activities, particularly in larger and midsize cities.

A Trend Towards Midsize Cities

There is a noteworthy migration trend towards midsize cities in the South, driven by several factors including favorable weather, access to parks, a lower cost of living, and business-friendly environments. As the country adjusts to new work patterns post-pandemic, many individuals and families have chosen to relocate, with approximately 2 million people moving to the South from various other regions.

For many, the appeal of cities like Birmingham and Tuscaloosa extends beyond just business opportunities. Residents are attracted to the quality of education, safety, and increased living space that these midsize cities offer.

Long-awaited Recognition

Notably, Birmingham and Tuscaloosa had not been included in the top 25 rankings since 2020 but made a commendable comeback in the surveys conducted from May 2024 to May 2025, as well as from January 2025 to May 2025. This return to prominence demonstrates a renewed interest and investment in the small business sector within these cities.

Comparative Growth Across Alabama

Alongside Tuscaloosa and Birmingham, other Alabama cities have also exhibited impressive growth in B2B payments since March 2020. Mobile, for instance, recorded an astounding 437% growth, while Montgomery and Huntsville observed 50% and 128% increases in B2B payments, respectively. This robust performance across Alabama emphasizes the state’s overall commitment to fostering an environment conducive to business growth.

Conclusion

The recognition of Tuscaloosa and Birmingham as top cities for small business growth is a testament to the ongoing economic revival and community development occurring within these areas. The increasing focus on local spending and the conducive conditions for doing business are likely to continue driving growth, making Alabama an attractive destination for both businesses and residents.

Deeper Dive: News & Info About This Topic

HERE Resources

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Additional Resources

• AL.com: Fastest Growing Cities
• The Bama Buzz: Small Business Growth
• Patch: Lemonade Day Registration
• Business Alabama: Awards Finalists
• WVTM13: COVID-19 PPP Fraud
• Wikipedia: Small Business
• Google Search: Small Business Growth
• Google Scholar: Small Business Success
• Encyclopedia Britannica: Small Business
• Google News: Small Business 2025

Author: STAFF HERE BIRMINGHAM WRITER

The BIRMINGHAM STAFF WRITER represents the experienced team at HEREBirmingham.com, your go-to source for actionable local news and information in Birmingham, Jefferson County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Sidewalk Film Festival, Sloss Music & Arts Festival, Magic City Classic, and civil rights commemorations. Our coverage extends to key organizations like the Birmingham Business Alliance and the Birmingham Civil Rights Institute, plus leading businesses in healthcare, finance, and manufacturing that power the local economy such as UAB Medicine, Regions Bank, and Encompass Health. As part of the broader HERE network, including HEREHuntsville.com, we provide comprehensive, credible insights into Alabama's dynamic landscape.