TikTok generated $14.7 billion in revenue for small business owners in 2023 and contributed $24.2 billion to U.S. gross domestic product last year, according to a paid report released by the company on Wednesday. The report, written by economic consulting firm Oxford Economics, found that TikTok supports at least 224,000 jobs in the United States, with California, Texas, Florida, New York and Illinois having the largest economic impact of the app.
Oxford Economics surveyed more than 1,000 small business owners and 7,500 TikTok users across the country to measure TikTok's economic value. The study was conducted before the launch of TikTok Shop, which has become a sales and marketing powerhouse since its launch last September, so the economic model does not include any boost to small business revenue from TikTok Shop.
TikTok funded the study and worked with Oxford Economics to provide internal operational information such as headcount.
The report states that TikTok has the greatest impact on the food and beverage industry, contributing $6.4 billion to GDP annually and supporting 73,000 jobs in 2023. The app also supports small businesses in the health and wellness and business services sectors, the report said.
The report said that last year alone, small businesses using TikTok as an advertising platform generated $5.3 billion in tax revenue for the U.S. government. According to the report, 39% of small business owners said that TikTok was crucial to the survival of their business, and 69% of small business owners said that TikTok has brought an increase in sales to their business in the past year.
Even outside of its user base, TikTok is a major contributor to the economy, the report found. The report said the app's operations in the United States generated an additional $8.5 billion in GDP last year, contributed $2 billion in tax revenue, and supported more than 59,000 jobs nationwide.
Reports show that minorities are more likely to use TikTok than non-minorities. 83% of black small business owners surveyed said that their sales have increased significantly after using TikTok to promote their business; 86% of Latino or Hispanic small business owners surveyed said that their sales have increased significantly; 88% of Asian and Pacific Islander small business owners also said that their sales have increased significantly.
All minority groups said TikTok played a vital role in helping them build brand partnerships and develop revenue streams, goals they would have struggled to achieve without the app.