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Survey small-business confidence tempered by slow recovery
HOUSTON (8/17/10)--About 61% of small-business owners have lowered their expectations of an economic rebound until 2011 or later because of uncertainty about the economic recovery, according to respondents to the most recent Business Confidence Survey recently released by Administaff, a provider of human resources services for small and medium-sized businesses. Only about 18% of respondents were optimistic and said a turnaround will happen in 2010, while 20% said they are unsure about the timing of a recovery (Maine Credit Union League’s The Weekly Exchange Aug. 9). The economy was listed by 78% of business owners as one of their biggest short-term concerns, up from 71% in April, followed by 53% citing government health care reform, 46% specifying rising health care costs and 40% listing controlling operating costs. For the longer-term, 70.7% of respondents said they were either very concerned or had elevated concerns about potential tax increases, followed by 70.3% listing government expansion and the effect on business, 67.9% designating the economy and 67.7% citing the federal deficit and the total national debt. When asked about their pipelines for new business for the balance of 2010, 48% of survey respondents said that they expect a sales increase, down from 55% in April; 31% predicted it will stay the same, while 12% anticipated decreasing sales, up from 7% last April. Also, 65% of owners and managers said they are either meeting or exceeding their 2010 performance plans compared to 72% in the last survey, while the remaining 35% reported that they are doing worse than expected. Administaff also announced compensation data from its base of more than 5,600 small and medium-sized businesses. Compared to 2009 second-quarter data, average compensation is up 2.1%, bonuses are up 11.2% and commissions are up 0.4%. Overtime pay is still low, running 8.2% of regular pay, under the 10% level that generally indicates a need for additional employees, but up slightly from 7.5%. “Many owners of small and medium-sized businesses seem to be hesitant to hire more workers and commit important financial resources in the face of current economic uncertainty,” said Paul J. Sarvadi, Administaff’s chairman and CEO. “However, they appear to be ready and willing to make those positive decisions as soon as key fiscal elements are in place.” When asked how they are managing the number of company employees, results were identical to April with 60% of participants stating that they are maintaining current staffing levels, 31% are adding new positions and 9% are laying off employees. The survey also found that 62% of participants expected to maintain employee compensation at current levels throughout 2010, 21% planned increases, 5% expected decreases, and 12% were unsure. Respondents to the Administaff Business Confidence Survey are among the small and medium-sized companies Administaff serves nationwide. The questions were designed to measure the state of the small-business community and gauge the activities and expectations of business owners in 2010, the company said. Administaff conducted the survey July 20-22 of CEOs, chief financial officers, and other executives in a variety of industries at its client companies.


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