Every New Year’s over at my USA TODAY Ask an Expert column, I write a Top Trends in small business column. It is two-parts research, one part prognostication. Over the years, some things have come to be perennial guests on the list, for example, the latest and greatest tech innovation (pay-per-click to social media and now, mobile marketing.) Others trends show up on the list but once, only to never be seen again, for example, in 2007: Global Warming May Put You Out of Business. (OK, we can’t get them all right!)
So I was thinking about the trends and issues that small business face recently as 1) it is that time of year again, and 2) the latest edition of the Bank of America Small Business Owner Report came into my inbox. The SBOR is a semi-annual survey that looks at the concerns and perspectives of small business owners across the country. It is always chock-full of useful, surprising insights, and the latest one is no different.
So what is the state of small business today?
Good, very good.
The first thing I noticed as I reviewed the poll results was just how optimistic those surveyed are about both the national economy and their local economy. (The SBOR surveys 1,000 small business owners whose annual income is between $100,000 and $4,999,999 and who employ between 2 and 99 employees. In addition, 300 small business owners were surveyed in each of nine big cities, for 3700 in total).
- 41 percent said the national economy will improve (compared to 34 percent last year)
- 45 percent said their local economy will improve (compared to 38 percent last year)
So the confidence of small business owners is on the rise, and that’s a good thing for all of us.
Not surprisingly, this confidence translates into hiring as 31 percent of respondents said they planned to increase hiring this year, mostly due to an expected increase in business and to bring in new skills to the business. Also, 20 percent plan on simply increasing the hours of their regular employees this holiday season to account for the extra business they expect.
We hear a lot these days about how the new health care law is effecting hiring, with some companies getting a lot of press for their vow not to hire so they don’t have to comply with certain aspects of the law. From the results in the SBOR, we see that most small business owners are not that shortsighted with 56 percent saying that Obamacare will have no effect on their hiring decisions. Only about a quarter said that as a result of the law they will hire only part-time and contract staff.
If there is any “bad news” in the report, I suppose it is that only 27 percent surveyed even offer health insurance to their employees. But this does not mean that they do not take care of their staff. Indeed, more than 9 out of 10 small business owners took some sort of action to “increase employee retention,” such as:
- Offering competitive salaries (54 percent)
- Offering flex time work options (47 percent)
- Bonuses (45 percent)
- Asking for, and implementing, employee feedback (38 percent)
- Offering career development (28 percent)
The same is true this holiday season with the small business owners surveyed stating that they plan to offer perks like bonuses, a holiday party, flex and vacation time, and gifts, as a way to thank loyal staffers.
And what about the Millennial employee, do small business owners like hiring them? You bet. More than half surveyed said Millennials (ages 18-34) offer a unique skill set, and 50 percent said that Millennials are conscientious in a way that adds benefit to the company.
The upshot of that is that we can see why people like working for small business. Aside from the oft-found friendly, family atmosphere present at small businesses, it is clear that the owners of these companies value their staff and work hard to keep and make them happy.
And you can also see why the SBOR is such a valuable tool. It is a snapshot into the state of small business, every six months, and don’t you love it when your pictures turn out so great?
Looking at the next 12 months, where do you think the state of small business will be in 2014?
About Steve Strauss
Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss.