N.H. businesses show some economic optimism
More than three-quarters of New Hampshire small businesses say they feel that the Granite State economy is in the same condition or better than that in other parts of the country – even though the majority of the state’s small businesses feel that the national economic climate is getting worse.
Those were among the results of the Citizens Bank’s Small Business Pulse Survey, a poll of business owners in New Hampshire, Massachusetts and Rhode Island. The results were released Sept. 25 by Cathy Schmidt, president of Citizens Bank New Hampshire, at the 11th annual Women’s Business Center Celebration in Bedford.
The survey of small businesses involved polling 200 Granite State business owners whose firms range in size from $100,000 in revenue to $10 million. The survey has been conducted annually by Citizens elsewhere in its market, but this was the first year that New Hampshire business owners were polled, Schmidt said.
In releasing the results, Schmidt noted that 76 percent of New Hampshire businesses responding found the economic climate in the state as in good a shape or better than the national economy as a whole. But 53 percent of respondents said they think the national economic climate is getting worse.
Schmidt said the respondents have “pressing concerns” over increasing fuel and insurance costs, and rising inflation. The survey also found that two-thirds of small businesses believe that having no state income tax helps the state’s business climate.
“We see New Hampshire small businesses facing the pinch from rising costs, but we also see optimism about the economic climate in New Hampshire,” Schmidt said.
The survey also revealed that despite that guarded national outlook, a majority (62 percent) reported an increase in gross revenues over the past three years, and nearly one-third increased their workforce levels. The survey also found that in the next year, about one-third (34 percent) of small businesses are planning to increase their capital investments, while almost three-quarters (72 percent) are planning to maintain their headcounts.
Also according to the survey, New Hampshire small businesses list as their biggest challenges to growth as: providing health insurance (82 percent); costs of insurance not related to health benefits, such as property and casualty insurance (78 percent); and fears of inflation (76 percent).
Some 71 percent also reported that increases in energy costs have had an impact on their business operations, with 52 percent saying that if energy costs remain the same or increase, it will have a negative effect on their ability to increase capital expenditures. Nearly half said they have changed business practices to conserve energy, including cutting back on usage (39 percent); changing driving habits (27 percent); and using energy-efficient heating (13 percent), lighting (12 percent), windows (11 percent) and air conditioning (4 percent).
Other concerns and challenges to growth reported by the majority of small businesses include:
• Finding new customers (69 percent)
• Strength of the U.S. dollar (64 percent)
• Corporate income taxes (57 percent)
• Access to skilled labor (55 percent)
• Borrowing costs/access to capital (50 percent)
• Financial fraud (50 percent)
• Costs related to heightened security measures (44 percent)
• Ability to retain/recruit employees because of the cost of housing in New Hampshire (43 percent)
Other data highlights from the Citizens Bank Small Business Pulse Survey can be found at www.nhbr.com.