Small business worry index
In 2020, America's smallest businesses have big concerns about the economy
Did you know that small business owners employ nearly 21 million people, which equals about 17% of the total U.S. workforce? While they may be individually small in size, this is a mighty group of business owners, and have issues and concerns that may differ from larger corporations. Since small business is our business, we surveyed 500 small business owners to better understand what their worries are and the issues that keep them up at night. Below, you’ll get insight into the key findings of the major areas of concern.
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KEY FINDINGS AT A GLANCE
While there is a historically strong economy and job market, the economy is the number one worry plaguing small business owners. When there are changes in the market, small business owners are often hit the hardest during recessions and economic downturns. Some industries feel even more uncertainty about the economy than others, including agriculture/mining, manufacturing, and retail/wholesale. Tariffs have been a major topic in recent conversations and is what more than a third of survey respondents are most worried about as they are unsure how tariffs will impact their business.
The second-largest worry among small business owners is cash flow. Due to the nature of small businesses, it can be hard to ensure there is enough cash on hand for business expenses and payroll. One finding from the study showed that 1 in 4 small business owners worry about being able to cover payroll at some point in the year. By implementing some cash flow management tips, like identifying money leaks or staying organized, business owners can improve cash flow and keep reaching their financial goals and paying employees on time.
Regulations and Taxes
When opening a small business for the first time, owners tend not to realize how overwhelming managing payroll can be. Tax codes and regulations change frequently, and if small business owners aren’t staying up to date, it can be easy to be giving employees incorrect paychecks, which can lead to fines and other complications down the road. However, given the complexity, over 50% of survey respondents reported feeling comfortable with the taxes and payroll changes that could impact their business. For the business owners who aren’t as comfortable, choosing online payroll software, or working with an accountant or bookkeeper can help with payroll and taxes and ensure their business remains compliant.
Tech and Cybersecurity
While the advances in technology have been amazing for many things, those advances also lead to more options for individuals and businesses to become victims of a cyber attack. Compared to the other topics in the survey, small business owners aren’t as worried about cybersecurity attacks. Compared to large corporations, these smaller businesses tend to have a lower volume of sensitive consumer data to worry about, making them a smaller target for cybersecurity crimes. While this isn’t a major worry, small business owners reported that they do take steps to keep their information safe and protect important information related to employees, customers, and their business.
Ability to Hire Staff
Hiring is an interesting subject when it comes to small business owners. While we are in the midst of a competitive job market, small business owners are not too concerned about hiring. Nearly 60% of businesses reported no employee departures in 2018, which indicates high employee engagement and an overall healthy business. The largest hiring concern for 2020 is that the talent pool doesn’t have the skills needed for these small business owners. However, due to a competitive market where employees have so many options for employment, it’s important for small business owners to be aware of what attracts top talent including employee benefits and a focus on culture and diversity.
Looking for tips, tricks and reminders to help you better manage your payroll, as well as your business? Our blog provides timely updates, recommended reads and tried-and-true business tactics to help you stay on top of things.