Though there has been a lot of uncertainty about the economy over the last several years, the continual improvements observed more recently have led to many small businesses nationwide finally feeling better about their prospects for not only their own futures, but that of the entire country as well.
Through the end of the first quarter, 16 percent of small business owners say the U.S. economy is headed in the right direction, up from just 13 percent who felt the same way as 2012 came to a close, according to the latest U.S. Chamber of Commerce Small Business Outlook Study. This improvement was observed despite the fact that a smaller number – 46 percent – felt their local economies were on the right path; through the end of last year, 48 percent felt this way. However, that is still well above the 39 percent seen at the end of the three-month period from July to September.
Moreover, a larger number of small business owners feel better about the direction of their own companies, as seven in every 10 surveyed said this was the case, up from 69 percent in the previous quarter, the report said. However, that number was also down slightly from the 72 percent who felt the same a year prior. However, despite that high number of people who feel good about their businesses, equal portions of 28 percent each felt that their companies’ best days were either ahead of them or behind them, while the remaining 44 percent said they were unsure.
What concerns are largest for small business owners?
When asked about the challenges that small businesses now face, the largest – which was cited by 44 percent of respondents – was the nation’s economic uncertainty, the report said. However, it’s important to note that this figure was down from the slightly more than half who felt the same way just one quarter prior, which may indicate that the continued economic uncertainty nationwide is something to which small businesses are becoming accustomed, or at least less bothered by.
On the other hand, there was a slight increase in the number of executives who said their companies were concerned about the implementation of the Affordable Care Act, the report said. Through the end of March, about 45 percent felt this was a considerable issue facing their businesses, up three percentage points from the end of last year. This increase means that the opening three months of the year was also the first time economic uncertainty was not the top concern held by small businesses nationwide.
This may have weighed somewhat on hiring across the country, as just 20 percent of businesses say they plan to add new employees over the course of the next 12 months, though that was an increase of three points from the previous quarter, the report said. Nonetheless, 71 percent felt that the recent healthcare laws are generally going to serve to make it harder for companies to hire, and more than three-quarters also think it will make it more expensive to cover their existing workers. More than one in three polled said they would reduce hiring, and their number of full-time employees in order to become compliant with the law’s various mandates. More than one-quarter say they will stop insuring their workers altogether.
Small companies have many insurance-related concerns to consider in conducting their daily business. They may have to pay for general liability insurance, commercial property insurance, and more, and all these premium costs can add up quickly.