More than half of small to mid-sized businesses plan to hire amid persistent concerns regarding healthcare costs, talent availability and rising competitive worries
Atlanta, GA – June 11, 2015 – American small to mid-sized business leaders are moderately optimistic about near-term opportunities for the U.S. economy and SMB sector, and growth plans for the remainder of 2015 are generally positive. According to Lucas Group’s newly released SMB Job Generation Outlook, executives across the nation report that job creation, economic growth and the collective health of the SMB market appear to be in stable, good stead.
For more than two years, Lucas Group has conducted the quarterly SMB survey with the goal of compiling and delivering a comprehensive, executive-level report on the current opinions and future planning trends for America’s small to mid-sized business sector. According to the latest survey, executives appear to be moving toward the neutral middle in their expressions of either optimism or pessimism. While Q4 2014 saw a pop in executive optimism regarding growth prospects, Q1 2015 respondents weren’t as strong in their confidence.
Fifty-two percent reported being somewhat or very optimistic about job growth prospects for their own companies, several points below the survey’s historical average. Only nine percent said they were very optimistic, marking the first time in two years that those uber-hopefuls have dropped below 10 percent. The chill in optimism was not, however, met with an increase in pessimism. Those reporting being somewhat or very pessimistic about job growth prospects also dropped from previous quarters to under 10 percent.
“SMBs are looking to the remainder of 2015 with cautious optimism,” said Scott Smith, Chief Marketing Officer at Lucas Group. “Over the past several years, overall economic and employment outlook from this sector has been generally positive, and while enthusiasm moderated somewhat in Q1, more than half still plan to hire and over 90 percent say they’re in growth or stability mode.”
In addition to economic trends, the SMB Job Generation Outlook addresses an array of significant topics, including the top business concerns, political issues and SMB-specific growth plans. Since early 2013, SMB leaders have reported healthcare costs to be of chief concern to their businesses. That remained true in Q1, with 31 percent of SMBs citing healthcare costs as their #1 business issue.
However, as debate heats up among the White House and various Congressional factions regarding the role of Congress in trade policy, the Trade Promotion Authority and specifically, the Trans-Pacific Partnership, SMB concerns over competition have increased. For the first time in survey history, leaders reported a shift in the #2 concern, away from talent availability to challenges regarding domestic and international competition. Twenty-nine percent report competition as their chief business issue. Talent availability, which has consistently held a close #2 behind healthcare costs, dropped to 21 percent in Q1. Despite this drop in chief concern ranking, finding and hiring qualified professional talent remains difficult for 63 percent of SMBs.
The SMB Job Generation Outlook strives to capture executive plans and opinions on an array of social and political issues, including minimum wage, take-home pay, immigration reform, governmental impact and more. Additional findings from Lucas Group’s Q1 survey include:
• Over the past year, the survey has found that the proposed federal minimum wage increase to $10.10 per hour simply is not a core driver to the majority of small to mid-sized businesses nationwide. Since early 2014, an average of 54 percent of SMBs have reported that a mandated wage hike to $10.10 per hour would produce no impact on their businesses.
• Collectively and companywide, take-home wages have increased in the last year for more than three out of four SMB workers. Forty-two percent of SMB companies surveyed saw a minimal wage increase between one and two percent and another 35 percent saw higher increases. One in five executives report that take-home wages at their companies did not change during 2014, and only four percent said wages decreased.
• SMBs are pursuing a variety of methods to combat rising healthcare costs and prepare for future increases. One-third of respondents said they are reviewing their healthcare plans periodically and changing plans or providers to stay ahead of the challenge. Allowing for multiple responses, one in five responding SMBs are focusing on lowering costs by increasing the overall health of their employees through health education and wellness programs in conjunction with providers and community partners.
The SMB Job Generation Outlook is conducted by Lucas Group in coordination with Polaris Marketing Research and Dr. Goutam Challagalla, Associate Professor at the Georgia Institute of Technology Scheller College of Business. For the full Q1 2015 SMB Job Generation Outlook, click here.
About the Survey
Conducted quarterly, the SMB Job Generation Outlook is a national survey of SMB top business leaders. The Q1 survey was conducted by Polaris Market Research on behalf of Lucas Group from March 9 – 20, 2015. Each of the respondents was a CEO, CFO, COO, chairman, president, executive vice president and/or owner of their company. The survey covered a variety of industries with manufacturing, finance/insurance/real estate, business services, IT and construction having the strongest presence. Eighty-two percent of respondents were from businesses with fewer than 1,000 employees.
About Lucas Group
Lucas Group is North America’s premier executive search firm. Since 1970, our culture and methodologies have driven superior results. We assist clients ranging in size from small to medium-sized businesses to Fortune 500 companies find transcendent, executive talent; candidates fully realize their ambitions; and associates find professional success. To learn more, please visit Lucas Group at www.lucasgroup.com and connect with us on LinkedIn, Facebook, and Twitter.