SAN FRANCISCO - May 27, 2010
According to the latest Wells Fargo/Gallup Small Business Index, conducted April 12-16, small businesses remain hesitant to add more employees despite recent government incentives to promote hiring. When asked whether tax credits for hiring unemployed workers would encourage them to hire new employees in 2010, over half (52 percent) of respondents said “very unlikely.”
As business owners keep an eye on the economic recovery in America, they appear to be operating in a static environment with 53 percent of business owners maintaining current staffing levels - only hiring as many employees as needed. Additionally, when asked about changes in available weekly hours for employees, 67 percent of business owners say they have kept weekly hours the same. Nineteen (19) percent said they were decreasing hours.
“Small businesses are critical to the health and strength of our economy, as they employ about half of the private sector workforce and create more than 60 percent of net new jobs annually in the U.S.,” said Doug Case, Small Business Segment manager at Wells Fargo. “This has been a challenging period for small businesses. They are looking for assurance of an economic rebound before staffing for growth.”
While many business owners are hiring only as many workers as they need, 34 percent reported hiring fewer employees than needed. Of the reasons cited, 81 percent say they worry revenues or sales won’t be sufficient to justify adding more employees. Other reasons given include concerns about the potential cost of providing healthcare (65 percent).
Despite a challenging economy and uncertain times, the survey showed that small business owners retain their characteristic perseverance , with the majority (80 percent) saying they would become a small business owner all over again if they had to.
About the Small Business Index
For the last 28 quarters, the Wells Fargo/Gallup Small Business Index has surveyed small business owners on current and future perceptions of their business financial situation. Results are based on telephone interviews with 603 small business owners in all 50 United States conducted April 12-16, 2010.
For more than 70 years, Gallup has been a recognized leader in the measurement and analysis of people’s attitudes, opinions and behavior. While best known for the Gallup Poll, founded in 1935, Gallup’s current activities consist largely of providing marketing and management research, advisory services and education to the world’s largest corporations and institutions.
About Wells Fargo
Wells Fargo & Company is a diversified financial services company with $1.2 trillion in assets, providing banking, insurance, investments, mortgage, and consumer and commercial finance through more than 10,000 stores and 12,000 ATMs and the Internet (wellsfargo.com and wachovia.com) across North America and internationally.
Wells Fargo is America’s #1 small business lender (2008 Community Reinvestment Act government data) and a leading lender to women- and diverse-owned businesses. Through its award-winning online advice library of business resources, including topical videos and webcasts, Wells Fargo provides business owners with timely advice and information to help them succeed financially. For more information, speak with a Wells Fargo banker, visit wellsfargo.com/biz or call the National Business Banking Center at 1-800-CALL-WELLS.
Note: Survey results available upon request.