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Rising Gas, Energy Prices the Biggest Challenge for Small Business

Rising Gas, Energy Prices the Biggest Challenge for Small Business

Despite the chronic talk of lack of funding for small business, a recent survey finds that borrowing is not really on the minds of the majority of small-business owners. Instead, they are worried about the rising cost of gas , energy and raw materials, and the higher cost associated with taxes, health care and inflation.

That’s the finding of a new survey from Citibank. Despite their concerns, small business owners are somewhat optimistic about hiring , with 19 percent saying they are planning to grow their staffs this year. This is up from 14 percent who said they were planning on hiring in January.

When asked about wages, the majority of respondents say the compensation they pay their employees has remained the same in the past year, compared with 28 percent who have increased wages and 12 percent who cut employee pay. Fifty-one percent say they provide health care to their work force, compared with 49 percent who say they do not.

Overall, business owners are feeling more confident about their businesses. Sixty-nine percent say their business is better or about the same as a year ago, compared with 31 percent who say it is worse. Looking at the rest of 2011, 81 percent expect the year to be better or about the same as 2010, with 19 percent expecting it will be worse, the survey found.

In fact, business owners are feeling optimistic, in general.

  • 76 percent say they would start their business again even if they knew then what they know now about the challenges they would face;
  • 66 percent of respondents are likely or very likely to use a website to expand their business in 2011;
  • 58 percent say they will work longer hours themselves to grow their business;
  • 55 percent say the biggest benefit of owning a business is being your own boss .



Jeanette Mulvey
Jeanette Mulvey

Jeanette has been writing about business for more than 20 years. She has written about every kind of entrepreneur from hardware store owners to fashion designers. Previously she was a manager of internal communications for Home Depot. Her journalism career began in local newspapers. She has a degree in American Studies from Rutgers University. Follow her on Twitter @jeanettebnd.