By Joyce M. Rosenberg
NEW YORK — If you’re looking for relief from surveys and reports that say small business owners are feeling bleak: Stop.
The data is everywhere. It comes from small business associations and advocacy groups seeking to get the attention of lawmakers and big business. It’s commissioned by companies hoping to use the information they collect to draw attention to the products and services that they sell. And then there are reports from industry groups, academic institutions and think tanks looking to find new information and insights to help small business owners.
For at least a year, through the presidential election and the fiscal cliff crisis — part one and part two — surveys and reports showed little change. In the next several months, small businesses and the people interested in their success should brace themselves for more of the same. Right now, small companies have a lot of reasons to avoid risk:
Small business owner Terri Slater is uneasy about her public relations company because two clients put marketing campaigns on hold after they lost venture capital financing. Prospective clients are taking twice as long to decide whether to take her on. She uses freelancers to get marketing projects done.
“I don’t feel comfortable enough to make an investment in new employees because I’m not sure of the health of my client base,” Slater said.
Expectations are low. The year-end survey of owners by the National Small Business Association found that 38 percent anticipate growth opportunities for their companies this year. That’s down from the 47 percent who predicted growth in 2012, the trade group said. Sixty percent expected to keep their staffing levels stable this year.
“I’m right in there with other small business owners, I have no intention of hiring,” said Mark Hagar, owner of Specialized Printed Products in Fort Wayne, Ind.
Hagar is cautious because his customers, who also are small business owners, aren’t ordering as many printed brochures or running as many direct mail marketing campaigns as they did before the recession.
“There’s this great big circle of gridlock,” he said. “They’re not going to buy anymore because they’re uncertain about what their customers are going to do.”
Hagar’s sales were up about 2.5 percent last year, and he doesn’t expect to do better this year. He doesn’t need new equipment, so he has no plans to borrow money.
“We’re not going to have any real growth,” he said.
Owners are reluctant to hire or expand because their revenue is down, said Susan Woodward, an economist at Sand Hill Econometrics in Palo Alto, Calif., who tracks small business revenue for Intuit.
“They were all recovering for a while,” she said. “Then in early 2012, their revenue began to flatten.”
The picture isn’t completely dark. The housing market is recovering and the stock market is rallying. If that gets consumers to spend more, small businesses may pull out of their funk.
There are two key positive signs, said Martin Regalia, chief economist for the U.S. Chamber of Commerce, which represents 3 million businesses:
A healthy housing market and a persistent stock market rally could spur consumer spending and a revival of growth and hiring at small companies, Regalia said.
“You should see natural momentum building,” he said.
But there are other obstacles to a small business recovery. The health care law is high on that list. Businesses aren’t expected to know what their health care costs are until the last three months of this year, after states have set up the exchanges that will sell health insurance. Most anxious are owners with 50 or more workers who will be required to provide affordable insurance for their employees or pay a penalty.
Health care costs likely will remain a deterrent to hiring, said Paul Merski, chief economist with the Independent Community Bankers of America, a trade group that is familiar with the concerns of small businesses because its members work closely with them.
The bickering in Congress over the federal budget also will continue to discourage small businesses from hiring and expanding, Merski said.
“We need to get more positive movement in Washington,” he said. “It would take a situation where the country’s fiscal house at least has the appearance of turning around and going in the right direction.”