As job growth lingers, management still looking to increase workforces
WASHINGTON, Sept. 8, 2016 /PRNewswire-USNewswire/ — The National Small Business Association (NSBA) today released its 2016 Mid-Year Economic Report which shows a small-business community with ongoing concerns over the overall economy.
That said, despite the majority of small-business owners projecting a flat economy in the coming year, slightly more today are anticipating economic expansion than did just six months ago.
“Unfortunately, job growth continues to linger at just 23 percent of small firms adding new workers over the past year,” stated NSBA President and CEO Todd McCracken. “On the plus side, 12 percent of small-business owners said they plan to increase their workforce by more than 10 percent in the coming year—the highest this indicator has been since we started asking the question.”
Despite flat revenue, many plan to expand
Today, 72 percent of small-business owners are confident in the future of their own business—down slightly from December 2015. And while fewer small businesses reported revenue increases in the last 12 months, 45 percent said they plan to implement new advertising and marketing strategies, 28 percent plan to expand e-commerce, and 25 percent plan to launch a new product line in the coming year.
When asked about policy imperatives, the top thing small businesses want policymakers to do is reduce the national deficit, followed closely by end the partisan gridlock, simplify the tax system and rein-in the cost of health insurance. The survey also found that the administrative burden of federal taxes continues to outpace the actual financial cost of federal taxes.
“Our data shows a drop in bank lending to smaller firms, which has serious implications,” stated NSBA Chair Cookie Driscoll, owner of C. Cookie Driscoll Inc. of Fairfield, Pennsylvania. “An inability to access capital caused 20 percent of small firms to reduce their number of employees.”
The 2016 Mid-Year Economic Report was conducted on-line July 22 through Aug. 3, 2016 among 1,045 small-business owners.
Excerpt: All About that Capital
According to NSBA data from as far back as 1993, there is a clear correlation to a small-business owner’s ability to hire and his/her ability to get financing. Today, the number of small firms who report they are able to access adequate financing is 69 percent, down from 73 percent six months ago—another indicator driven by the smaller firm size of respondents.
There was a drop among those small firms that relied on bank loans, specifically community bank loans and large bank loans; again driven by the smaller business size of the survey respondents. As expected with a smaller firm size sample set, there was an uptick among respondents who said they relied on private loans (friends/family), something upon which many smaller or newer businesses rely more heavily.
Forty-one percent of small businesses said lack of capital is hindering their ability to grow their business or expand operations, and 20 percent said they had to reduce the number of employees as a result of tight
credit.
When asked about credit cards, 28 percent said the terms of the credit cards they use for their business have worsened in the last six months, up from 19 percent one year ago. One-in-five say they have been impacted by credit card fraud—either from their cards being used fraudulently, or customers using fraudulent cards
Please click here to download the full report.
Celebrating more than 75 years in operation, NSBA is a staunchly nonpartisan organization advocating on behalf of America’s entrepreneurs. NSBA’s 65,000 members represent every state and every industry in the U.S. Please visit www.nsba.biz or follow us at @NSBAAdvocate.
SOURCE National Small Business Association
