Release Date: 03/ 01/ 2005
CONTACT: Bill Vernon, (617) 482-1327 or Jim Jennings, (240) 645-4099
MASSACHUSETTS -- Massachusetts's overall business climate is improving, according to the inaugural Massachusetts Small Business ConditionsSM report. The new report's data, which was released today by the National Federation of Independent Business/Massachusetts, provides an overview of small-business conditions within Massachusetts and compares them with neighboring states.
"While there are still plenty of problems facing small firms today — from the high cost of health insurance to soaring unemployment insurance rates — the overall outlook of small-business owners is good," said Bill Vernon, NFIB/Massachusetts state director.
A net 33 (positive percentage minus negative percentage) percent of the state's small employers believed business conditions in their market area are good. They also saw those conditions remaining stable. A net 62 percent characterized the outlook for business over the next three months as "good", citing sales prospects as the primary reason for their view.
Small-business hiring has been slow with 19 percent noting they had "one or more" current job openings. Over the same three-month period, 42 percent of small-business owners made capital expenditures. While 41 percent of the respondents reported spending on technology upgrades, the number of owners making expenditures for employee training was 37 percent.
Of those surveyed in Massachusetts a net 18 percent indicated that profits were "good" and a net 35 percent characterized sales as good. Overall, a net 48 percent of small employers reported that over the last three months their purchasing prices rose while a net 17 percent reported they had increased selling prices.
When asked their most important business problem, Massachusetts small-business owners ranked insurance and competition from big business as the most serious of all conditions.
"As we see from the finding, the cost of insurance continues to be the dominant problem facing small firms today. Lawmakers have to get a handle on health insurance costs and other payroll costs if we are ever going to grow jobs in Massachusetts," Vernon concluded.
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. The text of the questions and the complete response set to the survey can be found at www.NFIB.com/research.
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.
| Massachusetts Small-Business ConditionsSM | ||||||
| This chart shows the results from Massachusetts and its comparative standing among selected nearby states. | ||||||
| Mass. | Conn. | N.Y. | ||||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 2/2005 | 13 | 14 | 3 | ||
| Prior qtr. | - | - | - | |||
| Business conditions in market area | ||||||
| Net % "good" | 2/2005 | 33 | 33 | 17 | ||
| Prior qtr. | - | - | - | |||
| Net % "improving" | 2/2005 | 12 | 13 | 7 | ||
| Prior qtr. | - | - | - | |||
| Outlook for business | ||||||
| Net % "good" in next three months | 2/2005 | 62 | 67 | 56 | ||
| Prior qtr. | - | - | - | |||
| Reason for optimism | ||||||
| % Sales prospects | 2/2005 | 47 | 56 | 63 | ||
| Prior qtr. | - | - | - | |||
| % Lower costs | 2/2005 | 4 | 2 | 2 | ||
| Prior qtr. | - | - | - | |||
| % Price increases | 2/2005 | 3 | 3 | 4 | ||
| Prior qtr. | - | - | - | |||
| % Greater productivity | 2/2005 | 16 | 11 | 10 | ||
| Prior qtr. | - | - | - | |||
| % Government policy | 2/2005 | 3 | 3 | 2 | ||
| Prior qtr. | - | - | - | |||
| Reason for pessimism | ||||||
| % Sales prospects | 2/2005 | 14 | 29 | 5 | ||
| Prior qtr. | - | - | - | |||
| % Cost increases | 2/2005 | 21 | 29 | 11 | ||
| Prior qtr. | - | - | - | |||
| % Pressure on selling prices | 2/2005 | 0 | 0 | 11 | ||
| Prior qtr. | - | - | - | |||
| % Lower productivity | 2/2005 | 0 | 7 | 5 | ||
| Prior qtr. | - | - | - | |||
| % Government policy | 2/2005 | 29 | 14 | 47 | ||
| Prior qtr. | - | - | - | |||
| Mass. | Conn. | N.Y. | ||||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 2/2005 | 35 | 40 | 25 | ||
| Prior qtr. | - | - | - | |||
| Profits | ||||||
| Net % profits "good" | 2/2005 | 18 | 18 | 12 | ||
| Prior qtr. | - | - | - | |||
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 2/2005 | 19 | 22 | 22 | ||
| Prior qtr. | - | - | - | |||
| Per employee payroll cost | ||||||
| Net % "risen" | 2/2005 | 17 | 22 | 29 | ||
| Prior qtr. | - | - | - | |||
| Employee cost pressures (greater) | ||||||
| % Wages | 2/2005 | 53 | 50 | 56 | ||
| Prior qtr. | - | - | - | |||
| % Benefits | 2/2005 | 33 | 32 | 28 | ||
| Prior qtr. | - | - | - | |||
| Mass. | Conn. | N.Y. | ||||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 2/2005 | 41 | 47 | 47 | ||
| Prior qtr. | - | - | - | |||
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 42 | 43 | 45 | ||
| Prior qtr. | - | - | - | |||
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 37 | 45 | 42 | ||
| Prior qtr. | - | - | - | |||
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 2/2005 | 61 | 63 | 54 | ||
| Prior qtr. | - | - | - | |||
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 2/2005 | 35 | 41 | 34 | ||
| Prior qtr. | - | - | - | |||
| % All credit needs not satisfied | 2/2005 | 9 | 8 | 12 | ||
| Prior qtr. | - | - | - | |||
| % No credit needs | 2/2005 | 51 | 47 | 47 | ||
| Prior qtr. | - | - | - | |||
| Mass. | Conn. | N.Y. | ||||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 2/2005 | 48 | 60 | 56 | ||
| Prior qtr. | - | - | - | |||
| Selling prices (last three months) | ||||||
| Net % increased | 2/2005 | 17 | 22 | 16 | ||
| Prior qtr. | - | - | - | |||
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 2/2005 | 11 | 13 | 17 | ||
| Prior qtr. | - | - | - | |||
| Single most important business problem | ||||||
| % Weak sales | 2/2005 | 10 | 9 | 11 | ||
| Prior qtr. | - | - | - | |||
| % Taxes | 2/2005 | 9 | 11 | 16 | ||
| Prior qtr. | - | - | - | |||
| % Employee quality/costs | 2/2005 | 10 | 14 | 9 | ||
| Prior qtr. | - | - | - | |||
| % Insurance | 2/2005 | 22 | 21 | 17 | ||
| Prior qtr. | - | - | - | |||
| % Big-business competition | 2/2005 | 17 | 15 | 14 | ||
| Prior qtr. | - | - | - | |||
| % Inflation/Rising prices | 2/2005 | 11 | 5 | 11 | ||
| Prior qtr. | - | - | - | |||
| % Credit availability/Interest rates | 2/2005 | 2 | 2 | 5 | ||
| Prior qtr. | - | - | - | |||
| % Regulations/Red tape | 2/2005 | 9 | 9 | 7 | ||
| Prior qtr. | - | - | - | |||
| Massachusetts Quarterly Spotlight | |
| Over the last year, which type of business insurance has had the most rapidly rising premiums? | |
| Vehicle collision and liability | 9% |
| Workers' compensation | 11% |
| Product or professional liability | 10% |
| Property and casualty | 10% |
| Employee health | 41% |
| Don't know/Refused | 18% |
| Total | 100% |
| Did those premium increases cause you to terminate or postpone planned business investments? | |
| Yes | 23% |
| No | 68% |
| Don't know/Refused | 9% |
| Total | 100% |
The Poll
NFIB’s Massachusetts Small-Business ConditionsSM is a telephone survey of a random sample of Massachusetts 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.
