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What’s Hurting Small Business These Days?

Posted By Scott Shane On February 11, 2013 @ 8:00 am In Economy | 9 Comments

red tapeIn separate January surveys, Gallup’s pollsters asked samples of American small business owners and adults how different political and economic situations were affecting them.

The results tell an interesting story. While many Americans are adversely affected by energy prices and health care costs, a higher fraction of small business owners feel that taxes and government regulations are hurting them [1].

The Comparison is Admittedly Imperfect

Gallup interviewed small business owners in 2013, between January 7th and 11th and American adults between January 21st and 22nd. More importantly, small business owners were asked about whether different situations were hurting or helping “the operating environment” of their businesses, while people in general were asked whether the situations were hurting or helping their “finances.”

Nevertheless, the data provide insight into the ways that political and economic conditions affect small business owners and non owners.

The two groups had statistically similar concerns about energy prices, with 79 percent of American adults and 77 percent of small business owners telling the interviewers that energy prices are a problem. (For both the surveys, the margin of error is +/- 4 percentage points.) Health care costs are also hurting both groups, with 73 percent of small business owners and 68 percent of American adults reporting this to the surveyors.

And both groups assessed the impact of the federal government’s debt ceiling similarly, with 56 percent of adults and 63 percent of small business owners saying it was harmful.

The two groups had similar views about the effect of federal spending cuts, though fewer members of both groups saw these as harmful: 46 percent of American adults and 40 percent of small business owners.

The small business owners differed from the overall sample in how much taxes, government regulation, credit, and immigration policies hurt. While 69 percent of American adults said that taxes were hurting their personal finances, 80 percent of small business owners said that taxes were hurting the “operating environment” of their companies.

Similarly, 72 percent of small business owners said that government regulations were a problem, while only 48 percent of American adults said so.

Fewer small business owners thought that immigration policies were harmful than American adults (38 percent to 25 percent). By contrast, 47 percent of small business owners felt credit availability was was a problem, as compared with 30 percent of American adults.

While the surveys don’t tell us whether small business owners think differently from other Americans or whether the situations affect small business operations more than personal finances, the differences are intriguing. Taxes and regulation are problematic for a larger fraction of small business owners than Americans overall.


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[1] feel that taxes and government regulations are hurting them: http://www.gallup.com/poll/160106/prices-energy-food-hurt-americans-finances.aspx