President Barack Obama and his every faithful sidekick Joe Biden continue to tell everyone that America’s economy is recovering. Harry Reid tells everyone that we need to raise more taxes to help cut the deficit. And Nancy Pelosi continues to tell everyone that Obamacare is cutting health costs and making it more affordable for business owners, their employees and individuals.
However, that’s not the way small business owners see the economy. In January, a small business survey was conducted by Wells Fargo/Gallup. They found that there were 10% more small businesses that were letting employees go than there were hiring.
When asked in the survey why they weren’t hiring, they gave answers that indicates a complete lack of confidence in the economy and the Obama administration. Their responses were:
Why are you not looking for new employees? For each of the following, please indicate a reason why you are not looking to hire. How about…?
- Don’t need any additional employees at this time……………………. 81%
- Worried revenues or sales won’t justify adding more employees…74%
- Worried about the current status of the US economy………………… 66%
- Worried about the potential cost of healthcare………………………… 61%
- Worried about new government regulations…………………………… 56%
- Worried about cash flow or ability to make payroll……………………55%
- Hard to find qualified employees………………………………………… 32%
- Worried you may no longer be in business in 12 months……………30%”
61% expressed concern about the cost of healthcare. Nancy Pelosi says it’s becoming more affordable as promised, yet everyone’s rates are going up. More and more small businesses are dropping their employee healthcare benefits because they can no longer afford the costs. I know one employer whose premiums increased by 41% this past year. Once the Supreme Court upheld Obamacare and the insurance mandate, a number of businesses began laying off thousands of employees because of the increased costs they were facing.
Notice that 30% of the small business owners indicated that they were worried that they may not be in business within the next 12 months. Drive through your town or community and look at all the small businesses. Now consider what would happen if 3 of every 10 of those small businesses closed their doors. How many empty stores and shops would there be? Virtually every small strip mall would have at least one or more shops empty.
Now realize that this would mean jobs lost for everyone who worked in those shops. It would also mean a loss of revenue for the landlords who own the buildings. If the landlords can’t find a new tenant, it would force a number of them to raise rent on the existing businesses, sell the strip mall to someone else or declare bankruptcy, possibly shutting down their entire strip mall. The companies that supplied the stores that closed will also experience a loss of business, possibly resulting in the laying off of some of their employees or closing their doors.
Consumer confidence has also continued to decrease, indicating that shoppers are also worried about the struggling economy and don’t see it improving as we are being led to believe. In a recent release, the Conference Board said that three indexes have decreased in January:
“The Conference Board Consumer Confidence Index®, which had declined in December, fell further in January. The Index now stands at 58.6 (1985=100), down from 66.7 in December. The Expectations Index declined to 59.5 from 68.1. The Present Situation Index decreased to 57.3 from 64.6 last month.”
So if you thought the past several years under Obama have been rough, you better brace yourself for even rougher times. From everything I’ve read and seen, I predict 2013 will see a number of businesses shut down, hundreds of thousands of people will lose their jobs, unemployment will increase, foreclosures and bankruptcies will increase and the national debt will continue to skyrocket. 2013 promises to be a very ugly year!