"Small-business owners' concern about the increasing cost of health insurance and a lack of access to capital is a wake-up call for policy makers in Washington," NSBA President Todd McCracken said. "Business owners are now willing to embrace health care reforms to a degree that will surprise many people."
Challenges Ahead
After unease about the economy's future (42 percent), the cost of health insurance (39 percent) and lack of available capital (31 percent) topped small-business concerns. While 58 percent of small-business owners offered health insurance to their employees 10 years ago, that number declined to 51 percent in 2000 and reached a low of 41 percent in 2007. This drop is especially troublesome because, when asked which benefit they'd most like to offer their employees, 77 percent selected health insurance. Small businesses also are finding it more difficult to obtain adequate financing. Ten years ago, 24 percent of business owners reported that they were not able to obtain adequate funding, mirroring the NSBA poll results in 2000. But, in 2007, 33 percent (a nine-percent increase) cited this concern. The smallest businesses, those with four or fewer employees, are most likely to turn to credit cards to fund their operations. Most businesses using a credit card to fund their business (71 percent) carry a balance from month to month. And, of those businesses, 36 percent carry a balance in excess of $10,000. Businesses unable to access capital report difficulty growing their business and hiring additional employees.
Economic Outlook
When asked to compare today's economy with the economy five years ago, the plurality of respondents (43 percent) felt today's economy was in worse shape. Women and minorities were significantly more likely to respond that today's economy is in worse shape. Even while many business owners have a dim view of today's economy, the vast majority (81 percent) have a bright outlook for their own prospects. The majority of small businesses expect gross revenues (68 percent) and net profits (65 percent) to increase in the next 12 months.
"While the 2007 NSBA Small Business Survey finds that our smallest businesses are pessimistic about the economy as a whole, they remain optimistic about their own prospects," said Glen Bolger, partner and co- founder of Public Opinion Strategies. "This tracks closely with what we'd expect to see from self-starting entrepreneurs."
When asked how they plan to grow their businesses in the coming year, advertising and marketing strategies topped the list (54 percent), followed by expanded use of the Internet (35 percent) and hiring new employees (28 percent).
