Government regulations take the biggest toll on small businesses, according to a new Gallup poll.
The Gallup Small Business Index, which polled more than 600 small-business owners in early October, showed that of all the possible obstacles facing small businesses, 22 percent felt government regulations caused the biggest problem, while 15 percent noted consumer confidence and 12 percent blamed a lack of consumer demand. Other issues cited by business owners included a lack of credit availability and poor leadership by the government. Surprisingly, the lack of jobs in the market was noted as the least problematic.
Many small-business owners are still worried about the fate of their business, with one in three owners saying they are moderately or very worried about going out of business. A similar number of small-business owners were moderately or very worried about competing with large or global competitors, not being able to hire employees or being unable to pay employees. Thirty percent fear they will have to cut down the size of their staff in the coming year.
"Given this situation and the fragility of the economy, I think a moratorium on new government regulations would be beneficial," said chief economist Dennis Jacobe, the author of the study. "We can leave arguments about the public benefit of new government regulations versus the cost to business for another –- better – economic situation."
Although many small-business owners will continue to face problems in 2012, many are just as worried about the long term. According to the poll, 67 percent of the owners are worried about not being able to save enough money for retirement, while nearly 50 percent fear they don't spend enough time with family or pursuing personal interests.
Small-business owners continue to hope for a turnaround, with 15 percent noting that a jump in sales will help their businesses to grow and thrive in the coming year. Other positive changes they'd like to see include job creation (14 percent) and fewer government regulations (12 percent), which will motivate them to hire new employees.
As far as whether more businesses felt positive or negative about the current economy, the poll indicates that most have been feeling pretty neutral since last summer and are simply doing what they can to stay ahead. Many look forward to the upcoming holiday shopping season, although another Gallup poll may indicate they have little to look forward to. According to the poll, Americans plan on spending an average of $712, the same as last year and about $200 less than in 2006, while one-third of Americans plan on spending $500 or less on holiday gifts. "This means another tough time this holiday for small businesses as they battle to get sales," Jacobe said. "Small businesses need an improved economy and new jobs in order to not only survive but thrive in 2012."