Regulations Crush Small Biz Confidence

Survey says smaller government key to helping small business.

Small business owners in this economy have a lot to worry about, and a lot to complain about. Regulatory burdens, however, topped the list of small business challenges in a recent Gallup poll.

Twenty-two percent of respondents cited “complying with government regulations” as the most important problem facing small businesses today, followed by “consumer confidence” at 15 percent and “lack of consumer demand” at 12 percent.

“There is always a debate to be had and a balance to be struck between the public benefits associated with government regulations and the cost of those regulations on business,” said Dennis Jacobe, chief economist at Gallup. “While regulatory change can have a big impact on individual companies and industries, most often it does not have a major impact on the overall U.S. economy. However, these are not normal economic times, and small-business owners seem to feel government regulations are making their difficult operating environment even more challenging.”

As they look to 2012, more than one third (36 percent) of small business owners said they are very or moderately worried about going out of business. A similar number (37 percent) are worried about not being able to compete with large or global competitors. The ability to hire the number of employees they need is a concern for 36 percent of respondents, while 32 percent are concerned about meeting payroll and 30 percent are worried about staff reductions.

“Growth in sales” (15 percent) was most often cited by respondents when asked what they need in order for their business to thrive in 2012. “Job creation” was the next most common response at 14 percent, followed by “fewer government regulations” at 12 percent. An “improved economy” came in at number four, with 8 percent.

Job creation is getting a lot of attention these days by politicians on both sides. When asked what would motivate them to hire new employees in 2012, 27 percent of small business owners in the Gallup survey said an increase in revenue or sales. Twenty percent are waiting until the economy improves and 17 percent said they would hire to support growth or expansion plans.

Results for the total dataset are based on telephone interviews with 604 small-business owners, conducted Oct. 3-6. For results based on the total sample of small-business owners, the maximum margin of sampling error is ±4 percentage points with 95 percent confidence.

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About Smart Companies Thinking Bigger®

Kelly Scanlon is the owner and publisher of Thinking Bigger Business Media. She recently finished a term on the national board of directors of the National Association of Women Business Owners, and was the national chair from 2010-2011. An advocate for small business owners, Kelly sits on numerous boards and committees to advocate on behalf of small business owners. She has won several awards for her advocacy. Among them are the 2011 United Nations NGO Positive Peace Award on behalf of Kansas City area small business owners, the U.S. Small Business Administration's Region VII Women's Business Champion of the Year in 2009, and the Women in Business Advocate of the Year from the State of Kansas in 2006. In 2002, she won the SBA's Region VII Small Business Journalist of the Year Award (Missouri, Iowa, Nebraska, Kansas). Whatever your business stage—aspiring, startup, established, mature—Thinking Bigger Business Media has the resources you need to grow to the next level. We are a resource organization dedicated to providing the strategic, "how-to" information small business owners need to become more productive and more profitable. We also provide information that helps owners connect with resources within the business community that can help them grow. We deliver that information through a variety of media products and other channels easily accessible to business owners.
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