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Small Business Owners Optimistic, Plans To Ramp Up Hiring
Written by Emily Johnson
Things are looking up for American small businesses over the next six months, says PNC's new study, and threat of higher minimum wage won't deter hiring for most.
According to PNC's latest Economic Outlook survey, small business owners are optimistic about their economic prospects for next six months.
PNC's study, released on Thursday, revealed the brightest economic outlook among small and mid-sized business owners across the country since 2010. Thirty-seven percent of owners are optimistic about their company's prospects during the next six months, up 15 percent since the previous wave of the study in the fall. Corresponding hiring and wage increases are expected in the next six months, with 22 percent of companies planning to add full-time employees and 32 percent planning to increase employee wages.
PNC's chief economist Stuart Hoffman said in a press release, "These findings support our baseline forecast that the U.S. economic and jobs expansion should quickly bounce back this spring and propel what should be the economy's best year since before the Great Recession."
For 70 percent of companies with a mix of salaried and hourly employees in PNC's survey, plans to ramp up hiring for 2014 stand regardless of a potential federal minimum wage increase. Only six percent say they will cut existing employees as a result of a wage increase.
President Obama brought federal minimum wage to the national stage in his 2013 State of the Union address and continued his efforts on Wednesday at the University of Michigan. Reporting by The New York Times cited data from the National Conference of State Legislatures that said California, Connecticut, New Jersey, New York and Rhode Island increased their minimum wages in 2013. Delaware, West Virginia and the District of Columbia followed suit this year, while several other states may see it on the ballet this fall.
Senate Democrats are expected to move forward with a vote among their chambers in the coming weeks to raise the federal minimum wage from $7.25 to $10.10, and index it to inflation, according to the Wall Street Journal. Members from both parties are working on their own plans for minimum wage.
Many small business owners are divided on their support for minimum wage hikes, and others are still deciding what to do about it. Amidst a looming minimum wage hike, small business owners may wonder: Should I hire new workers for my small business? Unfortunately, there's no "one size fits all" answer. To make the right decision, it's important for each business owner to assess his or her own business finances, model the impact of higher wages and determine an appropriate hiring plan.
For the rest of us, PNC's findings regarding small business optimism should be viewed as good news.
Small business owners' outlook on business expectations and job growth is a strong economic indicator, and the success of small businesses greatly impacts the overall health of the economy.
When things are looking up for small business, we can all look forward to better days ahead.
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