Small business management continues to experience challenges during extended economic uncertainty. While small-business owners are usually seen as a major source of job creation, managers are still reluctant to hire or make new investments in their companies. Small business management software could help owners effectively handle more tasks in their busy organizations.
Small-business confidence dropped in June after reaching a 12-month high in May, according to the National Federation of Independent Business Optimism Index. As confidence dipped, so did employment within small companies. Entrepreneurs added 360,000 part-time positions in June, but they removed 240,000 full-time jobs, resulting in static growth. Employers who wanted to hire new workers experienced difficulty finding the right candidates, and some used temporary employees rather than hiring permanently. The majority of owners did think it was a good time to expand their enterprise. After a few months of higher sales, numbers dropped last month, adding to uncertainty. Due to the decrease in sales, small-business owners did not expect to add to inventories or staff in the near future.
Growth will likely stay slow
Despite the lack of confidence in the NFIB report, other small-business findings have been mixed. Companies with fewer than 50 workers added 84,000 positions in June, and the majority came from firms with fewer than 20 employees, The Washington Post reported. The number was higher than most economists' predictions and showed small enterprises are overcoming the obstacles. Even companies that kept their sales numbers high were still hesitant to increase hiring immediately. Owners were concerned about increasing overhead costs and potentially taking on debt. Although confidence was lower overall, future hiring plans reached their fourth-highest level since 2007, Bloomberg Businessweek reported.
Until small-business owners are more confident and expand hiring, the sector will continue to stagnate, according to the NFIB report. With hiring expected to remain slow, managers might experience difficulty meeting increased demand. Economic uncertainty was causing managers to stand still, and 19 percent of managers were planning on increasing prices within the next three months.
As the economy slowly improves, small businesses will need to expand to meet increased demand from higher consumer spending. Running a small company can be difficult without assistance, but there are a number of available tools owners can rely on, such as small business accounting software.