Bloggers, economists and President Obama regularly tout small business owners as the job creators of our nation. But are entrepreneurs actually creating jobs?
The study polled 1,000 decision makers at small and midsize businesses (SMBs) about the toughest business challenges they faced this year, and their plans for 2012. Here’s what the SMB Business Perspectives study found.
Small businesses didn’t hire much this year, but, in general, they didn’t lay people off. In fact, you might describe 2011 as “the same old, same old.” More than 75 percent of the SMBs report their staffing levels held steady in these eight business functions.
- communications / marketing / sales
- product team
- business development
- executive team
Next year’s prospects
Will small-business hiring rates improve next year? Most of those surveyed (65 percent) don’t plan to hire more employees in 2012 than they did in 2011. However, 20 percent say they will add staff. Including full-time, part-time and temporary workers, how many employees do these entrepreneurs expect to hire?
- 44 percent will add one to five employees
- 19 percent will add six to 10 employees
- 13 percent will add 11 to 25 employees
- 14 percent will add 26 to 50 employees
- 4 percent will add 51 to 100 employees
- 6 percent will add more than 100 employees
So, what will these new employees be doing? Most of the business owners (60 percent) plan to hire business-development staff to take on their biggest 2011 challenges: attracting new and retaining existing customers.
Social media is also a hot growth area for hiring. Forty percent of the SMBs plan to use social media in their marketing next year.
How the economy affects SMBs' future
Business owners’ hiring next year will be affected by whether they were hurt or helped by recent economic conditions. Overall, 61 percent of the SMBs say the economy negatively affected their business this year. Of those who have no hiring plans, 66 percent admit their businesses were hurt by the economy. A mere 7 percent say the economy had a positive effect on them.
Interestingly, of those who were planning to hire, 26 percent say their businesses had been helped by the economy, while 42 percent say they suffered from it. Perhaps the latter group realizes that continued staff cutbacks could hurt their companies more than it helps their bottom lines, and that hiring may indeed be a necessary path to growth or even survival.
What about you? Will you keep your current staffing levels next year or hire? What would it take to get you to add employees?
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