Want to start a lucrative small business? Your best bet might be going into a blue-collar industry like construction, plumbing or electrical.
According to a study from Invoice2go, eight of the top 10 highest earning industries for small business ownership come from the blue-collar sector, and bill more than $5,000 per month on average.
Bob Briski, director of data infrastructure at Invoice2go, said the study's results challenge the perception that you need a four-year college degree to be among the top earners.
"While society tends to push everyone to get a four-year degree, and typically take on a lot of debt in the process, we are seeing countless examples of people carving out a very successful path of their own, particularly in blue-collar industries," Briski wrote on the company's blog. "There's a lot of opportunity out there, and with new technology to make it even easier to thrive as a small business operator, it's ripe for anyone's taking."
For the study, researchers examined invoicing activity of more than 33,000 U.S.-based Invoice2go users. "Earnings" was determined by taking the median monthly dollar amount invoiced per month for each business account between January and September of this year. Invoice2go users are typically entrepreneurs, side giggers, and microbusinesses with less than five employees. [See Related Story: The 10 Best (and Worst) Cities for Starting a Business ]
Topping this year's rankings are construction small businesses, which invoice more than $18,000 a month. Based on the research, the top 25 earning industries for small business ownership in the U.S. and their monthly average invoices are:
- Construction: $18,788
- Roofing: $16,942
- Flooring: $10,602
- Painting: $9,486
- Heating and air conditioning: $8,971
- Carpentry: $8,950
- Plumbing: $8,639
- Electrical: $7,490
- Interiors: $7,347
- Audio: $5,587
- Pool services: $5,412
- Security: $5,283
- Repair: $5,195
- Handyman: $5,194
- Auto repair: $4,35
- Landscaping: $4,030
- Catering: $3,333
- Events: $2,963
- Design: $2,680
- Cleaning: $2,555
- Photography: $2,243
- Fitness: $2,000
- Technology: $1,895
- Beauty and salon: $1,500
- Bakery: $1,043
In addition to looking at specific industries, the researchers also examined which cities offer blue-collar businesses the greatest earning potential. The highest earning cities for blue-collar business in the U.S. and their average monthly invoices are:
- Raleigh-Durham, North Carolina: $20,318
- Houston, Texas: $17,219
- Dallas-Fort Worth, Texas: $16,085
- Portland, Oregon: $13,294
- St. Louis, Missouri: $12,692
- New York City, New York: $12,426
- Sacramento-Stockton-Modesto, California: $12,408
- Seattle-Tacoma, Washington: $12,018
- Charlotte, North Carolina: $11,628
- Miami-Ft. Lauderdale, Florida: $11,586
Despite the high invoice amounts, it is important to remember that these blue collar businesses might not be making the most profit, said Mark Bartels, chief financial officer at Invoice2go. He said contributing to the reason for blue collar businesses topping the list is because the cost of roofing and construction servicers, for example, are high. However, those businesses often have low margins.
"Remember, what invoicing value doesn't tell you is the underlying cost of goods sold associated with an invoice," Bartels told Business News Daily. "For example, building a $30,000 driveway may yield a smaller profit than someone billing for services like graphic design or consulting where the only cost of goods sold is the person's time and laptop. "