December 22, 2014

Hiring Issues and Healthcare Put Damper on Small Business Growth

According to a new poll, the Manta SMB Wellness Index, small business owners were planning to hire at this time last year, but the majority (80 percent) haven’t added a single employee through the first quarter of 2012.

The survey found that more than half of small businesses (53%) say they are not taking advantage of the Patient Protection and Affordable Care Act (“Obamacare”) healthcare tax credit, which became available in 2010 for small businesses with fewer than 25 full-time employees. In fact, education may be needed in the business community as one in three small business owners say that don’t understand the law and its requirements.

Other findings:

  • What Healthcare Law? Nearly one in four small business owners say they aren’t sure how the Patient Protection and Affordable Care Act has or will affect their company. Half say it hasn’t impacted them and 14 percent say it has had a negative impact.
  • Who’s Hiring? Almost half of small businesses (45 percent) do not plan to hire more people this year than they did last year, but one-third say it’s too early to tell.
  • Not Quite an Economic Recovery: Close to half of small businesses (42 percent) feel the economy is not in recovery, while 21 percent say they aren’t sure.
  • Complicated Finances: More than four in 10 small business owners say taxes are more complicated for their company this year compared to previous years. Almost one-third (31%) report that they owed more in taxes this year than last year.

Also, according to the Manta research, new business activity fell 30 percent in the first three months of 2012, compared to the same time last year.

However, entrepreneurship still continues, and many small business owners aren’t letting factors they can’t control – like high gas prices or the unstable economy – stand in the way of building their business in new ways.

The Biz2Credit platform received a record number of registrations from small business owners looking for startup funding, working capital, equipment loans and lines of credit. The most recent Small Business Lending Index found that lending slowed only at big banks in March (and that downtick occurred after months of steady increases.)

Small business continues to be a main growth engine in the economy. While the climate is not perfect, it is certainly spring-like.


Slow Growth Photo via Shutterstock

2 Comments ▼

Rohit Arora


Rohit Arora Rohit Arora, CEO and Co-founder of Biz2Credit, is one of the country's leading experts in small business finance. Since its founding in 2007, Biz2Credit has arranged $800M in small business loans and has helped thousands of entrepreneurs. Rohit was named Crain's NY Business "Entrepreneur of the Year 2011."

2 Reactions

  1. Thanks, Rohit!

    I’m right there with the 25% of small business owners who seemingly have no idea how the new Health Care Law will be affecting all of us.

    Can’t it be simplified?

    The Franchise King®

  2. Although lots of people believe that the state of the economy is vitally important to their businesses, I have found that there are businesses who do not believe that the economy is as important. They run and grow their businesses in any economic condition. I wonder if anyone has made a poll for them.

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