Release Date: 03/ 01/ 2005
CONTACT: Jason Shelley, (317) 638-4447 or Kevin Walter, (614) 221-4107
INDIANA -- Indiana's overall business climate has plenty of room for improvement, according to the inaugural Indiana Small-Business ConditionsSM report. The new report's data released today by the small-business group National Federation of Independent Business/Indiana, provides an overview of small-business conditions within Indiana and compares them with neighboring and other states.
"Indiana's business climate when compared on a net percentage basis is 21 percent (percent positive minus percent negative), while our neighbor to the east, Ohio, is at 27 percent," said Jason Shelley, NFIB/Indiana state director. Forty-one percent of small-business owners feel Indiana's business environment is supportive while only 20 percent deem it unsupportive. The average net percentage for all states surveyed regarding their respective business environment was 25. South Carolina had the highest net percentage (40 percent) and Washington had the lowest (-9 percent).
"Various sources have produced numerous rankings and surveys of Indiana's business climate relative to other states, but this is the first one that specifically focuses on small-business conditions," said Shelley.
When asked to rank their most important business problem, Indiana small-business owners ranked the cost of insurance as the most serious of all conditions. "No surprise here. Our members continue to be plagued by the high cost of insurance, particularly health insurance, with no relief in sight," Shelley said. Other problems that ranked high include big-business competition and taxes.
There is some reason for optimism. A net 31 percent of the state's small employers believed business conditions in their market area are good and a net 15 percent believe conditions are improving. A net 63 percent characterized the outlook for business over the next three months as good, citing sales prospects and greater productivity as the primary reason for their view.
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 NFIB Research Foundation, visit www.NFIB.com/research.
| Indiana Small-Business ConditionsSM | ||||||
| This chart shows the results from Indiana and its comparative standing among selected states in the region. | ||||||
| Ind. | Ill. | Mich. | Ohio | |||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 2/2005 | 21 | 16 | 18 | 27 | |
| Prior qtr. | - | - | - | - | ||
| Business conditions in market area | ||||||
| Net % "good" | 2/2005 | 31 | 29 | 15 | 34 | |
| Prior qtr. | - | - | - | - | ||
| Net % "improving" | 2/2005 | 15 | 14 | 16 | 17 | |
| Prior qtr. | - | - | - | - | ||
| Outlook for business | ||||||
| Net % "good" in next three months | 2/2005 | 63 | 59 | 55 | 68 | |
| Prior qtr. | - | - | - | - | ||
| Reason for optimism | ||||||
| % Sales prospects | 2/2005 | 55 | 43 | 45 | 39 | |
| Prior qtr. | - | - | - | - | ||
| % Lower costs | 2/2005 | 3 | 3 | 2 | 3 | |
| Prior qtr. | - | - | - | - | ||
| % Price increases | 2/2005 | 2 | 3 | 2 | 5 | |
| Prior qtr. | - | - | - | - | ||
| % Greater productivity | 2/2005 | 17 | 13 | 14 | 19 | |
| Prior qtr. | - | - | - | - | ||
| % Government policy | 2/2005 | 2 | 5 | 3 | 4 | |
| Prior qtr. | - | - | - | - | ||
| Reason for pessimism | ||||||
| % Sales prospects | 2/2005 | 15 | 5 | 13 | 8 | |
| Prior qtr. | - | - | - | - | ||
| % Cost increases | 2/2005 | 5 | 10 | 9 | 0 | |
| Prior qtr. | - | - | - | - | ||
| % Pressure on selling prices | 2/2005 | 0 | 10 | 4 | 8 | |
| Prior qtr. | - | - | - | - | ||
| % Lower productivity | 2/2005 | 10 | 10 | 9 | 0 | |
| Prior qtr. | - | - | - | - | ||
| % Government policies | 2/2005 | 35 | 15 | 26 | 25 | |
| Prior qtr. | - | - | - | - | ||
| Ind. | Ill. | Mich. | Ohio | |||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 2/2005 | 28 | 22 | 21 | 36 | |
| Prior qtr. | - | - | - | - | ||
| Profits | ||||||
| Net % profits "good" | 2/2005 | 7 | 9 | 4 | 20 | |
| Prior qtr. | - | - | - | - | ||
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 2/2005 | 20 | 18 | 13 | 20 | |
| Prior qtr. | - | - | - | - | ||
| Per employee payroll cost | ||||||
| Net % "risen" | 2/2005 | 17 | 20 | 12 | 10 | |
| Prior qtr. | - | - | - | - | ||
| Employee cost pressures (greater) | ||||||
| % Wages | 2/2005 | 52 | 53 | 49 | 52 | |
| Prior qtr. | - | - | - | - | ||
| % Benefits | 2/2005 | 33 | 30 | 31 | 31 | |
| Prior qtr. | - | - | - | - | ||
| Ind. | Ill. | Mich. | Ohio | |||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 2/2005 | 40 | 43 | 45 | 43 | |
| Prior qtr. | - | - | - | - | ||
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 42 | 42 | 41 | 42 | |
| Prior qtr. | - | - | - | - | ||
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 36 | 43 | 41 | 37 | |
| Prior qtr. | - | - | - | - | ||
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 2/2005 | 60 | 59 | 59 | 57 | |
| Prior qtr. | - | - | - | - | ||
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 2/2005 | 37 | 36 | 36 | 39 | |
| Prior qtr. | - | - | - | - | ||
| % All credit needs not satisfied | 2/2005 | 11 | 8 | 10 | 7 | |
| Prior qtr. | - | - | - | - | ||
| % No credit needs | 2/2005 | 48 | 52 | 49 | 50 | |
| Prior qtr. | - | - | - | - | ||
| Ind. | Ill. | Mich. | Ohio | |||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 2/2005 | 58 | 55 | 60 | 46 | |
| Prior qtr. | - | - | - | - | ||
| Selling prices (last three months) | ||||||
| Net % increased | 2/2005 | 16 | 18 | 17 | 13 | |
| Prior qtr. | - | - | - | - | ||
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 2/2005 | 12 | 15 | 11 | 8 | |
| Prior qtr. | - | - | - | - | ||
| Single most important business problem | ||||||
| % Weak sales | 2/2005 | 11 | 10 | 13 | 11 | |
| Prior qtr. | - | - | - | - | ||
| % Taxes | 2/2005 | 13 | 7 | 13 | 11 | |
| Prior qtr. | - | - | - | - | ||
| % Employee quality/costs | 2/2005 | 11 | 8 | 7 | 8 | |
| Prior qtr. | - | - | - | - | ||
| % Insurance | 2/2005 | 16 | 12 | 17 | 14 | |
| Prior qtr. | - | - | - | - | ||
| % Big-business competition | 2/2005 | 15 | 11 | 13 | 15 | |
| Prior qtr. | - | - | - | - | ||
| % Inflation/Rising prices | 2/2005 | 12 | 16 | 11 | 13 | |
| Prior qtr. | - | - | - | - | ||
| % Credit availability/Interest rates | 2/2005 | 5 | 3 | 3 | 2 | |
| Prior qtr. | - | - | - | - | ||
| % Regulations/Red tape | 2/2005 | 7 | 9 | 6 | 10 | |
| Prior qtr. | - | - | - | - | ||
| Indiana Quarterly Spotlight | |
| Have higher energy prices experienced over the last year or so imposed a very serious, somewhat serious, not too serious, or not at all serious burden on your business? | |
| Very serious | 14% |
| Somewhat serious | 35% |
| Not too serious | 33% |
| Not at all serious | 15% |
| Don't know/Refused | 3% |
| Total | 100% |
| Which type of energy price increases most affect your business? | |
| Gasoline | 39% |
| Natural gas | 19% |
| Electricity | 22% |
| Heating oil | 1% |
| Diesel | 11% |
| Other | 5% |
| Don't know/Refused | 4% |
| Total | 100% |
The Poll
NFIB’s Indiana Small-Business ConditionsSM is a telephone survey of a random sample of Indiana 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.
