Release Date: 03/ 01/ 2005
CONTACT: Kim Maisch, (217) 523-5471 or Kevin Walter, (614) 221-4107
Small Businesses Split On Whether State Is Headed In Right Direction, Government Policies to Blame
ILLINOIS -- Despite similarities on many levels, Illinois' overall business climate and outlook for the future isn't as bright as its neighboring states, according to the inaugural Illinois Small-Business ConditionsSM report. The new report's data, which was released today by the National Federation of Independent Business/Illinois, provides an overview of small-business conditions within Illinois and compares them to Indiana, Missouri, Iowa and Wisconsin.
"Illinois small-business owners are not only feeling the pinch from higher taxes, fees and insurance costs, they are also losing their confidence in where our great state is headed," said Kim Clarke Maisch, NFIB/Illinois state director. "The economic realities of the last few years are leaving this state's heart and soul – our small-business community – wondering if Illinois will ever be a good place to do business again."
Only a net 16 percent of the state's small employers believe the current business climate in Illinois is supportive. This is well below the views of small-business owners in other Midwestern states. And while the heartland usually lags the rest of the nation on economic recovery, Illinois hasn't yet caught up with its neighbors.
"When almost half of those polled said they were not satisfied with the direction Illinois is headed, the elected officials and those making economic policy need to take heed," said Clarke Maisch, who added that only a net 1 percent said Illinois was headed in the right direction.
While the ever-optimistic small-business owners believe economic conditions are improving, again Illinois was outshined by other states in the region. A net 59 percent characterized the outlook for business in Illinois over the next three months as good, compared with a net 63 percent in Indiana, net 70 percent in Missouri and net 66 percent in Wisconsin.
Not surprising in the study was the fact that health insurance was the most important business problem in Illinois, with 41 percent indicating their health insurance premiums had risen more dramatically than any other type.
The Small-Business ConditionsSM reports are developed from surveys of small-business owners in selected states. The surveys are designed to determine the condition of the small-business economy in each particular state. The surveys are conducted every three months and results are released on the first day of the month following completion. For information about the Small-Business ConditionsSM project and other small-business research studies conducted by the NFIB Research Foundation, visit www.NFIB.com/research.
| Illinois Small-Business ConditionsSM | ||||||
| This chart shows the results from Illinois and its comparative standing among selected nearby states. | ||||||
| Ill. | Ind. | Iowa | Mo. | Wis. | ||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 2/2005 | 16 | 21 | 33 | 30 | 22 |
| Prior qtr. | - | - | - | - | - | |
| Business conditions in market area | ||||||
| Net % "good" | 2/2005 | 29 | 31 | 37 | 43 | 33 |
| Prior qtr. | - | - | - | - | - | |
| Net % "improving" | 2/2005 | 14 | 15 | 15 | 21 | 10 |
| Prior qtr. | - | - | - | - | - | |
| Outlook for business | ||||||
| Net % "good" in next three months | 2/2005 | 59 | 63 | 61 | 70 | 66 |
| Prior qtr. | - | - | - | - | - | |
| Reason for optimism | ||||||
| % Sales prospects | 2/2005 | 43 | 55 | 42 | 50 | 59 |
| Prior qtr. | - | - | - | - | - | |
| % Lower costs | 2/2005 | 3 | 3 | 3 | 2 | 1 |
| Prior qtr. | - | - | - | - | - | |
| % Price increases | 2/2005 | 3 | 2 | 4 | 4 | 5 |
| Prior qtr. | - | - | - | - | - | |
| % Greater productivity | 2/2005 | 13 | 17 | 16 | 15 | 12 |
| Prior qtr. | - | - | - | - | - | |
| % Government policy | 2/2005 | 5 | 2 | 5 | 5 | 3 |
| Prior qtr. | - | - | - | - | - | |
| Reason for pessimism | ||||||
| % Sales prospects | 2/2005 | 5 | 15 | 29 | 10 | 20 |
| Prior qtr. | - | - | - | - | - | |
| % Cost increases | 2/2005 | 10 | 5 | 18 | 10 | 10 |
| Prior qtr. | - | - | - | - | - | |
| % Pressure on selling prices | 2/2005 | 10 | 0 | 0 | 0 | 10 |
| Prior qtr. | - | - | - | - | - | |
| % Lower productivity | 2/2005 | 10 | 10 | 6 | 0 | 5 |
| Prior qtr. | - | - | - | - | - | |
| % Government policies | 2/2005 | 15 | 35 | 6 | 50 | 30 |
| Prior qtr. | - | - | - | - | - | |
| Ill. | Ind. | Iowa | Mo. | Wis. | ||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 2/2005 | 22 | 28 | 44 | 39 | 37 |
| Prior qtr. | - | - | - | - | - | |
| Profits | ||||||
| Net % profits "good" | 2/2005 | 9 | 7 | 29 | 23 | 20 |
| Prior qtr. | - | - | - | - | - | |
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 2/2005 | 18 | 20 | 15 | 17 | 19 |
| Prior qtr. | - | - | - | - | - | |
| Per employee payroll cost | ||||||
| Net % "risen" | 2/2005 | 20 | 17 | 13 | 25 | 23 |
| Prior qtr. | - | - | - | - | - | |
| Employee cost pressures (greater) | ||||||
| % Wages | 2/2005 | 53 | 52 | 55 | 59 | 52 |
| Prior qtr. | - | - | - | - | - | |
| % Benefits | 2/2005 | 30 | 33 | 26 | 29 | 35 |
| Prior qtr. | - | - | - | - | - | |
| Ill. | Ind. | Iowa | Mo. | Wis. | ||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 2/2005 | 43 | 40 | 41 | 39 | 46 |
| Prior qtr. | - | - | - | - | - | |
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 42 | 42 | 46 | 44 | 55 |
| Prior qtr. | - | - | - | - | - | |
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 43 | 36 | 37 | 38 | 43 |
| Prior qtr. | - | - | - | - | - | |
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 2/2005 | 59 | 60 | 51 | 55 | 48 |
| Prior qtr. | - | - | - | - | - | |
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 2/2005 | 36 | 37 | 47 | 38 | 45 |
| Prior qtr. | - | - | - | - | - | |
| % All credit needs not satisfied | 2/2005 | 8 | 11 | 5 | 6 | 8 |
| Prior qtr. | - | - | - | - | - | |
| % No credit needs | 2/2005 | 52 | 48 | 43 | 53 | 43 |
| Prior qtr. | - | - | - | - | - | |
| Ill. | Ind. | Iowa | Mo. | Wis. | ||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 2/2005 | 55 | 58 | 50 | 54 | 58 |
| Prior qtr. | - | - | - | - | - | |
| Selling prices (last three months) | ||||||
| Net % increased | 2/2005 | 18 | 16 | 14 | 21 | 15 |
| Prior qtr. | - | - | - | - | - | |
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 2/2005 | 15 | 12 | 10 | 12 | 9 |
| Prior qtr. | - | - | - | - | - | |
| Single most important business problem | ||||||
| % Weak sales | 2/2005 | 10 | 11 | 8 | 7 | 9 |
| Prior qtr. | - | - | - | - | - | |
| % Taxes | 2/2005 | 7 | 13 | 9 | 14 | 12 |
| Prior qtr. | - | - | - | - | - | |
| % Employee quality/costs | 2/2005 | 8 | 11 | 8 | 10 | 9 |
| Prior qtr. | - | - | - | - | - | |
| % Insurance | 2/2005 | 21 | 16 | 19 | 17 | 25 |
| Prior qtr. | - | - | - | - | - | |
| % Big-business competition | 2/2005 | 11 | 15 | 17 | 12 | 14 |
| Prior qtr. | - | - | - | - | - | |
| % Inflation/Rising prices | 2/2005 | 16 | 12 | 10 | 12 | 14 |
| Prior qtr. | - | - | - | - | - | |
| % Credit availability/Interest rates | 2/2005 | 3 | 5 | 1 | 4 | 3 |
| Prior qtr. | - | - | - | - | - | |
| % Regulations/Red tape | 2/2005 | 9 | 7 | 11 | 9 | 7 |
| Prior qtr. | - | - | - | - | - | |
| Illinois Quarterly Spotlight | |
| In general, how satisfied are you with the direction that Illinois is headed? | |
| Very satisfied | 5% |
| Somewhat satisfied | 42% |
| Not too satisfied | 25% |
| Not at all satisfied | 21% |
| Don't know/Refused | 7% |
| Total | 100% |
| Over the last year, which type of business insurance has had the most rapidly rising premiums? | |
| Vehicle collision and liability | 8% |
| Workers’ compensation | 15% |
| Product or professional liability | 10% |
| Property and casualty | 8% |
| Employee health | 41% |
| Don't know/Refused | 18% |
| Total | 100% |
The Poll
NFIB’s Illinois Small-Business ConditionsSM is a telephone survey of a random sample of Illinois small employers regarding business conditions within the state. “Small employer” is defined here as employing between one and 250 people (not including the owner(s)) in a for-profit business. Each edition of the survey has a minimum of 350 respondents. The sampling error is ± 5 percentage points. Data are collected quarterly in the months of February, May, August and November, beginning in February 2005. The MRCGroup of Las Vegas conducts the survey for the NFIB Research Foundation.
The Sponsor
The NFIB Research Foundation is a 501 (c)(3) organization that provides policy-makers, media, educators, small-business owners and other interested parties empirically based information on small business and small-business owners. The Foundation is affiliated with the National Federation of Independent Business, the nation’s largest small- and independent-business advocacy organization, and is located in Washington, D.C.
