The difficult economic climate has created many challenges for small companies in their business management and hiring plans. Although the economy is gradually recovering, small businesses are still slow to increase hiring. These organizations typically have fewer resources than their larger counterparts, so they are often slower to take on new workers after experiencing economic difficulty. Small business management software can help companies prepare to expand hiring and successfully handle new challenges.
Small-business owners are starting to feel more optimistic about their economic prospects, but the increased positivity has not led to a jump in hiring, according to Capital One's recent "Spark Small Business Barometer" study. Nearly half of business managers felt their finances would be better in six months, and many small-business owners felt their financial position had improved in the past year. In addition to increased financial optimism, small-business owners were feeling better about their local economies.
However, despite positive sentiments regarding personal finances and economic outlook, the majority of small-business owners did not plan to increase hiring in the next six months.
"Our survey results for the second quarter indicate that while optimism and confidence are on the rise and more small businesses are on sound financial footing, concerns and uncertainty continue to hold back plans for staffing increases," said Jon Witter, president of direct, consumer and small business banking at Capital One.
Witter went on to say that improved sales seen by small businesses during the last six months have not directly translated to workforce investment and creating new jobs.
Small businesses slow to grow
The National Federation of Independent Businesses found hiring in the small business sector in June was essentially flat. More than half of small employers reported attempting to hire new workers in the last three months, but they faced difficulty in finding qualified employees. The report found more companies were planning to add new workers, but growth was still slow. Many small-business owners were concerned about continued economic uncertainty and the impacts of health care reform.
However, implementation of the Affordable Care Act and mandatory employer health care coverage for companies with 50 employees or more has been delayed until 2015, so small business hiring could begin to pick up, Bloomberg Businessweek stated. Worries over the costs of health insurance was leading small employers to delay hiring plans, but with the extension and improved economic prospects, small businesses might start hiring.