Help Wanted: Small-Business Owners Struggle to Fill Jobs
NEW YORK (MainStreet) There is growing pessimism as the government budget crisis continues, but one-in-five small-business owners have job openings that they cannot fill. A National Federation of Small Businesses survey also reports that optimism among small-business owners declined slightly in September, as the rancor in Washington began to gain momentum.
"The change in this month's Index was little more than 'statistical noise,' but the drop in outlook for future economic conditions is evidence that many owners are keeping an eye on Washington," NFIB chief economist Bill Dunkelberg says. "Prospects for politicians and policymakers 'getting it right' are low, and job creators are rolling their eyes and shaking their heads thinking, 'This is certainly not the way to run the largest enterprise in the world.'"
Nearly one-quarter (24%) of owners surveyed reported regulations and red tape as their No. 1 business problem, 18% cited taxes and 17% said "poor sales." Only 2% reported that financing was their top business problem.
Other findings from the survey include:
- Small-business owners are in no mood to add debt. More than half (53%) said they did not want a loan, while 28% of owners surveyed reported all of their credit needs had been met.
- A tiny, but growing (8%, up 3 points), segment of small-business owners believe they will see sales improve.
- Price movement was mixed. An equal number (14%) of the NFIB owners surveyed reported reducing their average selling prices in the past three months (down 2 points), as well as raising prices (down 3 points). But heading into the holiday sales season, 21% plan on raising average prices in the next few months, while only 2% plan price reductions.
- One in five (20%) owners reported raising compensation, while an additional 13% plan to hand out raises in the coming months.
The September survey also reports more than half (55%) of small businesses had capital outlays over the past six months, while one-quarter (25%) are planning expenditures in the next three to six months.
"Between botched health care implementation and one manufactured crisis after another, consumers and small-business owners are likely to remain pessimistic, accepting the notion that growth is going to be sub-par and that their government is likely to continue in dysfunctional mode for months to come," Dunkelberg says.
By Hal M. Bundrick for MainStreet