With a financially tough year behind them, small business owners are feeling equally pessimistic about their economic prospects in 2014.
According to a study conducted by the National Federation of Independent Business, business owners believe that among other factors, increased regulations, burdensome taxes and the contentious political climate in Washington negatively impact their bottom line.
“As 2013 comes to an end, small business owners are no more optimistic about the economy than they were at the beginning of the year,” said Bill Dunkelberg, NFIB’s chief economist in a video address on the organization’s website.
He continued, “Since the recovery started in July 2009 the index has wobbled between 88 and 95 — never able to break out of that range or even reach the average or display recovery performances above 100.”
The index rose 0.9 points to 92.5 in November, but this is still far below the average score of 100 that stood throughout the decades between 1973 and 2007.
Dunkelberg noted that small businesses have been suffering more than Fortune 500 companies.
“The ‘bifurcation’ continues with the stock market hitting record high levels, but the small-business sector is showing little growth beyond that driven by population growth,” he said.
Obamacare is also a concern for Dunkelberg: “There is also a hint that employers are getting an inkling of what Obamacare might mean for labor costs, concern about the cost and availability of insurance bumped up 3 percentage points after a long period of no real change… Small business owners who provide health insurance may soon find that their plans ‘unacceptable’ to Obamacare and be obliged to either pay more for the coverage or abandon it and pay the benefit in cash. This will be a major source of angst and uncertainty in 2014.”
Business owners are also worried about uncertain energy costs, regulation and the U.S. tax code.
The record number of new regulations posted in the federal registry — with a new one written every few hours — have been especially tough on businesses’ bottom line.
“Compliance costs add up to about $1.8 trillion a year,” notes Dunkerberg.
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