NEW YORK (Press Release – February 8, 2012) – Small business owners have more confidence and see growth ahead in 2012, according to the latest Citibank small business survey released today.
“The survey revealed an increase in hiring intentions from small business owners – the largest we’ve seen in two years,” said Raj Seshadri, Head of Small Business Banking at Citibank. “Whether it’s confidence in consumer spending or planning for growth, our survey shows momentum for small businesses in 2012.”
The survey revealed that 26 percent plan to increase their permanent full-time employees during the next year – a 12 point increase from Jan 2011. Seventy one percent plan to keep their workforce the same size. Twenty-two percent say they plan on bringing some seasonal workers on full-time. In addition, 44 percent of respondents said they planned to work more hours and four of 10 are planning to further increase employee productivity.
While a majority of small businesses see consumer spending holding steady (53 percent), a third see an uptick on the horizon. Almost half of those surveyed think 2012 will be a better year for business (46 percent) and 41 percent think things will remain the same.
“We are very encouraged by the survey findings,” said Seshadri. “Small businesses are a key driver for the economy. The prospect that small businesses are stabilizing or expanding in 2012 is a positive step in the right direction.”
Plans for Growth:
- Nearly half (48%) foresee that they are holding steady and “poised to grow when conditions are right.” An additional one-third of small businesses believe they will be growing rapidly or moderately in 2012.
- Five years from now, 56 percent of small business owners predict they will be larger than today, while 34 percent believe they will continue to hold stable through that same time period. Only 1 in 10 owners anticipate they will be closed in the next five years.
- To achieve expected growth for their businesses, planned steps include:
- Increase marketing to attract new business (65%)
- Introducing new products or services (59%)
- Obtaining better pricing from suppliers, vendors, landlords (59%)
- Expanding business in a greater geographic area (35%)
- Pursuing partnership opportunities with other companies (27%)
Economic Key Findings:
- Eighty seven percent believe 2012 will be better or about the same as 2011.
- Forty percent describe business conditions as good or excellent, a six point increase from Citibank’s September survey and a seven percent increase year-over year.
- Seventy seven percent are still concerned about a double dip recession, versus 90 percent in Citibank’s September 2011 survey.
- Seventy eight percent still believe they are prepared for another economic downturn.
Passion about their business:
Small business owners show a continued passion for what they do. When asked what they see as the benefits of running their own business, even after the challenges of the last few years, business owners cite:
- Being their own boss (85%)
- Making strategic decisions about the company (83%)
- Relationships with customer (81%)
- Providing jobs and opportunities for their communities (75%)
- Living their dream (65%)
- Stability and job security (62%)
“While challenges certainly remain in the economy, this survey is consistent with what we’re seeing and hearing from our clients, in that they are optimistic about 2012, take pride in what they do and are always looking for ways to grow their business,” said Seshadri. “Our goal for 2012 is to help small businesses grow by providing the capital and services they need.”
About the Survey
This Citibank poll was conducted by telephone January 17, 2012 – January 27, 2012 among a national random sample of 750 small business owners/operators, age 18 and older throughout the United States with revenue over $100,000 and no more than 100 employees. The margin of error for the national sample is approximately +/- 3.58 percentage points at 95% confidence. Surveys are subject to other error sources as well, including sampling coverage error, recording error, and respondent error.
Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management. Additional information may be found at www.citigroup.com.