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Small Business Owners See Recovery In 2011

Small business owners’ expectations of an economic rebound have been pushed out until the second half of 2011, even with improving indicators within their own businesses, according to a new survey by Aministaff.

Only 21% expect a rebound before mid-2011, while 47% expect a recovery in the last six months of next year and 32 percent are unsure.

Compared to the 2009 third quarter data, average compensation is up 3.2 percent, bonuses are up 14.9 percent, and commissions were up a strong 8.1 percent versus less than 1 percent last July. Overtime pay at 8.9 percent of regular pay was up from 8.1 percent last quarter and 7.5 percent in April, but was still under the 10 percent level that often prompts a need for additional employees.

“Owners and managers of small and medium-sized businesses are seeing signs of improvement in sales but remain cautious in their economic expectations,” said Paul J. Sarvadi, Administaff’s chairman and chief executive officer.

“However, many have hopes the election results may lead to a more favorable business climate and increased predictability for their businesses.”

The economy was listed as the leading short-term concern by 77 percent of business owners, followed by 56 percent citing government health care reform, 54 percent specifying rising health care costs and 37 percent listing controlling operating costs. For the longer-term, the top responses were very close with 69 percent saying they were either very concerned or had elevated concerns about potential tax increases, 67 percent listing government expansion and the effect on business, 66 percent designating the economy and 65 percent citing the federal deficit and the total national debt.

When asked about their pipelines for new business for the balance of 2010, 38 percent of survey respondents said that they expect a sales increase; 43 percent predicted it will stay the same; 12 percent anticipated decreasing sales; and 7 percent were unsure.

The survey also said that 54 percent of participants expected to maintain employee compensation at current levels throughout 2010, 26 percent planned increases, 1 percent expected decreases, and 19 percent were unsure.

About the Author:
Mike Sachoff is a staff writer for SmallBusinessNewz.

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