In December 2014, the National Federation of Independent Business released its Small Business Optimism survey, which demonstrated a positive outlook on the part of small business owners that has not been seen since the financial crisis. In fact, the report demonstrated a major surge in the percentage of small business owners who are predicting that the U.S. economy is poised to improve. Particularly of interest was a question asked in the survey concerning what business owners perceive as their biggest problem in this moment in time. Most notable here was the increase in the percentage of small businesses saying that taxes are among their top problems.
Following the financial crisis, there was a huge surge in the percentage of small business owners who cited sales as the biggest challenge their companies faced. As of November 2014, mention of that issue has dropped dramatically. In fact, labor quality (the inability for companies to locate and bring in qualified applicants) to date has become an almost bigger problem for small businesses. Problems such as taxes and labor quality are similar to those plaguing companies in the 1990s during the economic boom of that era.
The main takeaways from this survey are as follows:
- In 1998, the “single most important problem” cited by small businesses was taxes, followed by labor quality, sales, and lastly, interest rates and finance.
- In 2009, immediately following the 2008 crisis, the “single most important problem” for small businesses was reported as sales, followed by taxes, labor quality, and finally, interest rates and finance.
- In November 2014, the “single most important problem” facing small businesses was once again taxes. This was followed by sales, with labor quality close behind. Again, the least problematic issue small businesses faced was reported as interest rates and finance.
Given the parallels between November 2014 and 1998, these survey findings seem to bode well for the immediate future of small businesses.
Weisenthal, Joe. “More and More Small Businesses Say Taxes Are Their Biggest Problem—and That’s a Good Sign.” Bloomberg Business. 12/9/14.