US small businesses are struggling to move out of the recession and to hire additional employees.

The US unemployment rate increased from 9.8% in September to 10.2% in October. Small businesses have led the turnaround in employment after economic downturns in the past, but that has not happened yet.

A survey by the National Federation of Independent Businesses reports that 19% of small firms, on a seasonally adjusted basis, reduced worker numbers by an average of 4.2 workers in the July, August, September period. Only 8% increased staff in that period, by an average of 3.5 for each business.

The Small Business Administration says that small firms, defined as under 20 staff, provide 25% of all jobs and contributed 40% of employment growth after the last recession.

The reasons that small businesses are not hiring aggressively are:

Credit restrictions - most do not have property to offer as security, which is generally required, with tightened borrowing conditions being applied by lenders.

Few small firms export – so the economic upturn internationally is not helping them.

Cost of health care – the cost for small businesses is substantially higher than for large firms. The healthcare bill which was passed by the House of Representatives provides a cap on costs and wider coverage, and if passed by the Senate will help with this problem for small US companies.

So although the recession is technically over, with the US economy returning to growth, the state of business for small firms is still difficult and they are not yet hiring in sufficient numbers to lower the unemployment rate.

We contribute to the success of small businesses by sending them qualified prospects from our Local Search facility in our US Business Directory with no cost to them. Most of the 10 million business listed in our directory are small businesses.

Monte Huebsch, CEO

The US newspapers decline in circulation continues at an increasing rate.

The Audit Bureau of Circulations reports that the average weekday circulation of 400 daily papers reduced by over 10% to 30.4 million for the 6 months to the end of September. This was more than the 7% reduction in the previous 6 months.

Readers are moving from print to online to access news and the online versions of the newspapers are not producing sufficient advertising income to replace the loss of revenue from their print products.

While some newspapers are now trying various methods to get web users to pay for their information, this is generally not succeeding.

The consulting firm Outsell Inc. reports that the reduction of content and the increasing of price for both single papers and home delivery have contributed to the decline in readers. They also say that 90 papers have stopped publishing at least one day a week and many have reduced delivery to subscribers in small, remote communities.

The Wall Street Journal, with 2 million subscribers, is now the largest selling daily paper, replacing USA Today, which fell 17% to 1.9 million.

The New York Times was number three, having fallen 7% in the six monthly period, the Los Angeles Times was fourth, down 11%. and the Washington Post was number five, having fallen 6%.

Smaller local newspapers are doing better because the local events they report are usually not available online.

The movement from print to online seems to be a permanent trend, making it very difficult for many well established newspapers to continue to trade profitably.

The switch to online also applies to finding businesses and our Local Search facility in our US Local Directory helps in that regard. We send prospects to the 10 million businesses listed in our directory with no cost to them.

Monte Huebsch, CEO

More employees of US small businesses are losing their health insurance.

The Small Business Administration reports that health insurance premiums continue to increase and the projection is that by 2025 a quarter of the US economy will be spent on health care. 

As premiums have increased, the number of businesses offering health insurance to employees is falling, reducing from 63% to 60% in the last year.

This is accentuated in small firms, those with less than 10 employees, where firms offering coverage reduced from 57% in 2000 to 46% in 2009. 

The reason small businesses are having such difficulty maintaining employee health cover is the higher premiums they are asked to pay, 18% higher than large firms, and administration costs which are four times higher than for large companies. 

Almost 3 million employees, who are uninsured, work for firms with less than 25 staff. Over the last two years, 25% of employees of small businesses lost their health cover. 

Half of the individuals working for businesses who don’t offer health insurance have no private cover. The option of private cover is not viable for most due to the high cost, with no premium limits being applicable in 33 states, and broad exclusions which can be applied by insurance companies in effect in 45 states. 

Reforms currently being discussed would give small businesses tax credits to assist with employee health care costs and allow people to switch jobs without loss of cover. The changes would also not allow insurers to discriminate based on age, gender or prior conditions. 

With the unemployment rate increasing from 5.8% in 2008 to 8.9% in 2009, 4 million workers lost their health cover, increasing the number uninsured to over 50 million. 

The reform of health care is critically important and very difficult to enact due to the power of the vested interests involved. Small firms are the most vulnerable and urgently in need of assistance to provide or retain health cover for employees. 

We assist US small businesses with our Local Search facility on our US Business Directory which delivers qualified prospects to them without cost.

Most of the 10 million firms listed on our directory are small businesses. 

Monte Huebsch, CEO

Small U.S. businesses are not using social networking sites for business purposes.

A survey for Citibank Small Business by GFK Roper of 500 small U.S. firms reports that 75% of them do not use Facebook, Twitter or LinkedIn to find prospects for their businesses.

86% do not use social networking sites to get business information and only 10% have used them to find business advice.

42% have used their websites substantially to get business prospects and new business.

19% of the small firms said they were advertising more due to the economic slowdown, 41% were doing the same level of advertising, and 38% were doing less.

28% said they were using email and 25% were advertising online to attract new sales.

Hitwise reports that Facebook has 56% of social network traffic, MySpace has 30% and the next best has less than 3%. Facebook had a 200% increase in user numbers compared to a year ago.

However, U.S. users spend an average visit of 26 minutes on MySpace and slightly less, 23 minutes, on Facebook.

In the search field, Google still dominates with 64% of U.S. searches, with Yahoo having 19% and Microsoft having 9%.

As more business searches are done online, at the expense of old media, particularly the print phone books, we help small U.S. firms by delivering qualified prospects to them from our Local Search facility in our U.S. Business Directory with no cost to them. We have over 10 million firms listed in our directory and most are small businesses.

Monte Huebsch, CEO

U.S. small businesses need assistance in meeting the cost of employee health care costs.

A Families USA study in 17 U.S. states reported that, in Georgia, health care premiums rose six times faster than income, over the last 9 years. The cost to employees increased 150% over that period, from 2000 to 2009. 

Small businesses are the hardest hit, with the least capacity to pay. The U. S. Small Business Administration advises that there are 27 million small businesses in the U.S. providing income for over 70 million employees and their families. This is over 99% of all U.S. employers and firms with up to 20 staff produced 80% of all new jobs from 1990 to 2003. 

So even though small U.S. businesses are the basis of employment growth, the attention given to them in the health care reform debate has been minor. The current health care bill being debated means while some small businesses would pay less, others would pay more. 

The influence that large companies are able to exert over legislators is obvious. 

A recent survey of 343 small businesses proprietors by the U.S. Public Interest Research Group, found that 76% thought that they were not being correctly considered in the health care reform discussions. 78% of firms who don’t provide health care benefits said they wanted to, but 80% of them said that the cost involved stopped them form being able to offer coverage. 

Congress needs to address the cost issues for small businesses, particularly the substantial discounts in health care premiums that are offered to large firms compared to smaller businesses. 

We assist U.S. small companies by sending them qualified prospects from our Local Search facility in our Business Directory at no cost to them. There are over 10 million businesses listed in our directory and the majority are small businesses. 

Monte Huebsch, CEO.

 

The average cost of a U.S. employer paid family health care plan has increased by 5% in the last year.

A report by the Kaiser Family Foundation and Health Research & Educational Trust says that the cost of the average employer provided family health care plan is now $13,375 per employee, an increase of 5% from 2008. 

The increase is less than earlier years, but inflation was minus .7% over the same period. 

The survey of 2,000 companies found that 40% of employers are likely to pass some of that increase on to employees, by increasing the amount that their employees pay for visits to doctors, and for prescription drugs. 

9% of employers said they would make the eligibility conditions for health care cover tighter and 8% said they would stop providing health care cover completely. 

A separate survey of 1,250 in July reported that now people are more concerned about not being able to afford medical treatment than about meeting mortgage payments or losing their job. 

Many large health insurers anticipate a 10% premium increase in the next year. Premiums are now double what they were a decade ago. 

The Business Roundtable, an organisation of C.E.O.s of large U.S. companies, anticipates premiums will increase to about $29,000 per employee over the next 10 years. 

As the President pushes for health care reform, the various special interest groups are exerting political pressure on legislators to satisfy to their individual agendas. 

Small U.S. businesses are the hardest hit by health care cost increases, with the least capacity to pay. 

We assist them by providing qualified prospects from our Local Search facility in our U.S.A. Business Directory, which has over 10 million business listed, at no cost to them. Most listings are small firms, so the additional business which is created without expense is very helpful. 

Monte Huebsch, CEO.

 

Female C.E.O.’s have been very successful during the economic downtown.

The annual economic survey by the Women Presidents’ Organisation shows that 55% of female C.E.O.’s of large companies have maintained or grown their staff numbers during the global recession.

67% of their companies either increased or maintained their staff’s salaries. 

The Women Presidents’ Organisation is an organisation of 1,400 women executives who own or control large businesses in the USA, UK, Canada, Peru, and South Africa. 

82% of these C.E.O.’s have a positive view about the results for their businesses in 2010. 

Comparing 2008 to 2009: 

31% of their companies have grown. 54% have made their business “green”, that is environmentally friendly and 35% additional intend to do so. 

These results demonstrate the flexibility of female executives in coping with difficult financial circumstances and support the view that greater female numbers in large company’s boardrooms would produce a positive outcome. 

As most of the developed world comes out of recession, unemployment is still a major concern, particularly in the US. Creativity and flexibility are qualities that are greatly needed at this time.

Female creativity and ability to change with changing circumstances is a resource which has been undervalued and not properly utilised. Results like these are an indication of the benefits in making a change to a more gender balanced mix of business leaders. 

We support females in business with our USA Local Search facility in our Business Directory, by supplying the 10 million businesses listed, many of which are owned or run by women, with qualified prospects at no cost. 

Monte Huebsch, CEO.