The U.S. Chamber of Commerce released the results of its quarterly Small Business Outlook Survey this week, and it’s not a good look. Unfortunately, the grim results were not unexpected, giving a glimpse into what small business owners perceive as a poor economy for some time ahead.
According to the survey, which questions more than 1300 executives from businesses with fewer than 500 employees and revenues below $25 million, most small businesses don’t plan to hire anytime soon. Only 17% of polled respondents plan to hire within the coming year, a decline over the previous quarter. Even worse, more businesses claim they will have net layoffs in the coming year than previously anticipated.
According to Giovanni Coratolo, Vice President of Small Business Policy at the Chamber, small businesses just don’t see the economy turning around anytime soon.
“Nine out of ten small business owners feel the economy is on the wrong track.” Coratolo said. “That’s up 84% over the previous year.”
Aside from macro-economic concerns, small business executives cite fears about Washington intervention as their second greatest impediment to hiring. 41% of respondents (an increase over the previous quarter) cited the Affordable Care Act as a regulation that will pose undue burden on their business, potentially limiting its ability to hire. This said despite organizations such as the Small Business Majority claiming that the health care law will actually help reduce small business health care costs.
However, notwithstanding such widespread concerns amongst business executives, nearly 70% say that their own business is headed in the right direction. Combined with the fact that only one-third feel that a “lack of sales” is their biggest hurdle to growth, evidence continues to support the perception that businesses are still performing well, thereby placing the greatest burden upon Washington policies and the overall economic climate.
What do small business owners want from Washington? Most, 86%, say they want more certainty out of Washington as opposed to more assistance. Caratolo points to proposed legislation and increased costs within the President’s jobs plans as being detrimental to small business growth.
“Dodd-Frank created a strangle hold on access to capital . . . and small businesses continue to be concerned about future legislation,” says Caratolo. According to the survey, small businesses overwhelmingly, by more than 80%, prefer jobs plans proposed by the GOP or the U.S. Chamber of Commerce.
On the heels of the Senatorial defeat of the President’s American Jobs Act, these findings leave nearly everyone wondering: is there really anything Congress or the President can do to turn this economy around?
With a stalemate in Congress, and the President on the campaign trail, lack of action from Washington may just be what small business owners are looking for.
