MetLife & U.S. Chamber of Commerce Small Business Index
Over half (61%) of American small businesses rate the health of their small businesses as good, including 38% describing their business health as very good. However, these positive sentiments are not universally shared across the entire sector. Smaller businesses with fewer than five employees are less positive (33% very good) as are businesses operating in the service (34% very good) or retail (33% very good) sectors.
The large majority of small businesses report no significant change in their staffing levels over the last year, with 72% reporting they retained the same size staff. However, certain segments report hiring growth. Business owners with 20 or more employees are much more likely to report staff increases in the past 12 months. Likewise, younger companies—less than 10 years old—outpace the overall hiring rate.
Due to the last recession, small businesses I know have had limited access to capital through bank loans and other financing, not allowing them to expand their operations or even stay in business.
MICHELE EVANSON, CEO
Evan International, Fayetteville, NY
Overall, small business owners and operators feel that the U.S. economy is in decent shape. Nearly threequarters (74%) feel that the U.S. economy’s health is either average of above average. One-third (33%) note that the U.S. economy is in somewhat good or very good health, with one-quarter (25%) saying that the economy is in poor or somewhat poor health.
The majority (78%) of small business owners and operators rate the economic health of their local area as average or above average. Four-in-ten (42%) report the health of their local areas as somewhat good or very good. Approximately one-quarter (22%) rate the local economy’s health as somewhat poor or very poor. There is great variation by region. Nearly half of small businesses in the South (49%) report that their local economy’s health is somewhat good or very good. In contrast, three-in-ten (31%) small business owners in the Northeast report similar sentiments.
Roughly three-quarters (76%) report that the amount of competition is consistent with six months ago, and around 15% report facing more competition. However, 26% of larger businessess in the small business segment (100-500 employees) say they are facing increased competition.
Overall, small business owners and operators report spending roughly the same amount of time and resources on regulatory tasks as they did six months ago. One-quarter (25%) feel that they’re spending more time over the same time period. Larger companies (20-99 employees and 100-500 employees) report spending more time on these activities (36% and 32% respectively).
Kentucky is facing a tremendous amount of growth right now in the construction sector. I agree the overall U.S. economy has not grown like we would have hoped from a major recession. I am cautiously optimistic with the new administration this will improve more rapidly.
JAMES STRANGE, VP
Advanced Electrical Systems, Louisville, KY
We are definitely hoping to add staff this year, but there is a huge skills gap in our area for the licensed spa professionals that I employ.
PATRICIA OWENS, PRESIDENT
FACES DaySpa, Hilton Head Island, SC
While one-quarter (25%) of American small business owners and operators plan to increase investments in their business in the upcoming year, the plurality of small business owners (56%) anticipates investing about the same amount in their business. Roughly one-third (34%) of small businesses that have been in operation less than 10 years anticipate investing more in their business next year, compared to only 23% of businesses in operation 10 years or more.
In the conversations I am having with small business owners around the country, I am starting to see that sense of confidence and optimism bounce back. Therefore, I am not surprised to see that a relative healthy one quarter of small businesses plan to increase investment next year - though I think we would all like to see that number continue to grow in the months ahead.
Small Business Policy, U.S. Chamber of Commerce
Across the board, a majority (60%) of small business owners and operators are hopeful and expect revenues to increase in the coming year – only 9% anticipate a decline in revenue. Most notably, regional variations exist amongst small business owners’ and operators’ confidence in future revenues. Optimism reigns in the South, with 64% of small businesses expecting greater revenue next year. Conversely, only 54% of small businesses in the Northeast foresee positive revenue growth.